Oil rises above $88 as OPEC leaves output stable
SINGAPORE: Oil prices rose above $88 a barrel Monday in Asia after OPEC left its crude output quotas unchanged, citing slowing demand and abundant supplies. Benchmark oil for January delivery was up 53 cents to $88.32 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract lost 58 cents to settle at $87.79 on Friday.
Ministers from the 12nation Organization of Petroleum Exporting Countries said at a meeting in Quito, Ecuador on Saturday that a "fragile global economic recovery" and "fears of a second banking crisis in Europe" kept the cartel from raising oil production. Many OPEC nations depend on oil sales for foreign currency reserves and government spending and are reluctant to take measures to undermine prices. However, a jump in crude prices would spark inflation and hurt global economic growth. "The ministers generally love existing prices," Cameron Hanover said in a report. "Some insiders have hinted at a quota increase if crude oil prices break above $100 a barrel." -Reuters