Oil prices down ahead of Opec meeting

Oil prices eased below $60 (€43) a barrel today as investors awaited the latest meeting of the Opec oil-producing cartel later this week.

Crude for July delivery hit a six-month high of $62.26 (€44.52) a barrel on the New York Mercantile Exchange last week – compared with just $35 (€25) in March - after a steady climb on hopes for economic recovery.

But Opec is expected to leave current production targets in place at the Vienna meeting – easing the pressure on prices – although analysts have not ruled out a further shock production cut.

July crude was today trading at $59.94 (€42.87) as prices fluctuated on conflicting factors such as fresh terrorist attacks in Nigeria’s oil-rich Niger Delta and weaker stock market sentiment after recent rises.

More gloomy data from the world’s largest economy today showed house prices falling at their fastest annual rate ever in the first quarter of 2009.

Saudi Arabia’s oil minister Ali al-Naimi has also voiced concerns about global crude stockpiles, which are being kept high by weak demand amid the economic downturn.

“The market is looking six months down the line. Right now, the actual physical demand for crude remains very weak,” ANZ senior commodity strategist Mark Pervan said.