Posted by Spencer Swartz
Crude may be taking a breather Tuesday, down about $1 a barrel, but some OPEC countries appear to be giving oil traders a-wink-and-a-nod for pushing crude prices higher.
Earlier Tuesday, Kuwait’s Oil Minister Sheikh Ahmad Abdullah al-Sabah told reporters that $82 oil was “fantastic” and said the Gulf state doesn’t think OPEC needs to change production in March at its next policy meeting based on current prices.
An official in Kuwait’s Supreme Petroleum Council then told Zawya-Dow Jones that OPEC “will not consider it an alarming event even if oil hits $100…” Last week, Libya’s top oil official, Shokri Ghanem, said, “As long as (oil prices) are under $100 there is no need for (OPEC) action.”
For months, the 12-nation cartel has repeated like a mantra its comfort with crude oil prices between $70 and $80 a barrel. That’s a relatively tolerable level for consumers, and certainly cheery for OPEC states, whose drilling costs are a tiny fraction of today’s $81 oil price in New York.
Olivier Jakob, an analyst with Swiss-based Petromatrix, thinks the recent the recent OPEC chatter is basically talking up prices. “While OPEC will blame higher oil prices on speculators, they are trying to sponsor the same speculation by making the rounds saying that OPEC will not move a finger unless [West Texas Intermediate] rises above $100 a barrel,” Mr. Jakob said in a research note Tuesday, referring to the U.S. oil-price benchmark.
Moderate voices within OPEC–such as Saudi Arabia, which holds most of OPEC’s spare production capacity–recoil at suggestions that OPEC wants higher prices and say they’re genuinely pleased…