EIA reports oil futures up on possibility of OPEC cuts

Petroleum News Staff

The Energy Information Administration said May 1 that the June West Texas Intermediate futures contract was at $26.10 per barrel in overnight trading, up 30 cents a barrel from the April 30 closing price. The April 30 price, $25.80 a barrel, was up 56 cents.

The EIA said crude oil futures climbed in correction of recent losses as weekly data showed weaker-than-expected build in crude inventories and because of remarks by the Organization of Petroleum Exporting Countries on oil prices.

The EIA quoted OPEC President Abdullah al-Attiyah as saying “I am very, very concerned about the decline in prices. … I am in contact with other ministers and we are working out something to intervene in the market.”

EIA said OPEC had agreed the week of April 21 to cut production by 2 million barrels a day, but may act again soon, possibly voting at a June 11 meeting to reduce output, according to OPEC Secretary-General Alvaro Silva.

The EIA reported a build in U.S. crude oil stocks of 1.8 million barrels to 288 million barrels the week of April 21 but said U.S. crude inventories remain 37.5 million barrels below where they were a year ago.

In Iraq, the EIA said, April 25 reports from the Office of Reconstruction and Humanitarian Assistance indicating that Iraqi oil production had reached 235,000 barrels per day have been called into question. Reports on April 28 indicated that leaks in pipelines had slowed resumption of operations at the Basra refinery in southern Iraq; reports on April 29 indicated that the leaks had been fixed.