Oil prices rise above $80 per barrel

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 34 cents to $88.13 a barrel at midday 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 12-nation 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.”

In other Nymex trading in January contracts, heating oil rose 1 cent to $2.47 a gallon, gasoline futures added 1.8 cents to $2.33 a gallon and natural gas jumped 7.1 cents to $4.49 per 1,000 cubic feet.

In London, Brent crude rose 47 cents to $90.95 a barrel on the ICE Futures exchange.
Source: AP