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Oil prices slip ahead of OPEC meeting

Oil

NEW YORK: World oil prices fell Tuesday as traders eyed this week’s crucial OPEC oil meeting and key Chinese data.

In New York trade, US benchmark West Texas Intermediate for delivery in July lost 23 cents at $49.10 per barrel.

Brent North Sea crude for July fell seven cents to $49.69 a barrel in London.

The cautious trade came ahead of the meeting of the Organization of the Petroleum Exporting Countries in Vienna beginning Thursday to review the market and production levels.

It comes as crude prices have rebounded from their January lows under $30 a barrel, easing some of the pressure on the producers group to cut output to strengthen prices.

“There is little expectation that oil ministers are likely to come to any agreement on production quotas or freezes,” said CMC Markets analyst Michael Hewson.

“However that scarcely matters, given the current direction of travel for oil which currently looks well-supported just below the $50 a barrel level.”

It will be the first OPEC meeting with the new Saudi oil minister Khalid al-Falih, who replaced the venerable Ali al-Naimi in early May.

The market has gained support in recent weeks due to production outages in Canada and Nigeria, but at least in Canada output is expected to quickly pick up.

Meanwhile traders expect Chinese manufacturing data due on Wednesday to set the tone for the market. If the data is favorable it could indicate a pick-up in crude demand in the world’s largest energy consumer.

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