The Organization of Petroleum Exporting Countries' resolve to maintain oil prices at $18 a barrel despite recent spot market weakness helped boost prices about 70 cents Tuesday on the Northwest European spot market, oil traders said.
Major OPEC producers are said to be accepting lower sales volumes rather than discounts from fixed prices, traders said. This has reduced OPEC's collective output to less than 16.0 million barrels a day, they said.The insistence of Indonesian Oil Minister Subroto that OPEC would not hold an emergency meeting to review prices and production helped restore confidence in OPEC's ability to uphold its accord, they said.
Perceptions that low OPEC output could tighten the supply in the coming weeks could support prices and indicate the beginning of a stabilization process, traders noted.
Renewed OPEC confidence produced a turnaround in New York crude oil futures and North Sea Brent, with April delivery Brent blend crude gaining 70 cents from Monday, to $16.55 a barrel, they said.
March and May delivery Brent gained 65 cents and 70 cents respectively to $16.50 a barrel.
In the Middle East, Dubai crude oil was 65 cents firmer at $16.50.