SINGAPORE: Oil prices rose above $132 in Asia on Wednesday as the world s biggest producers and consumers prepared to meet to discuss record crude costs that are stoking fears for the global economy.
New York s main oil futures contract, light sweet crude for July delivery, was $1.15 higher at $132.46 per barrel after slumping $3.04 to close at 131.31 at the New York Mercantile Exchange on Tuesday.
The contract rocketed to a record $139.12 on Friday, soaring by $10.75, the largest single-day increase in history.
Brent North Sea crude for July delivery rose to $1.03 to $132.05 per barrel after a fall of $2.89 to $131.02 in London on Tuesday.
The Brent contract struck a historic peak of $138.12 on Friday.
We can continue to expect some choppy trade but the overall trend is still upward, with further price spikes as we head further into the summer, said Victor Shum, an analyst at Purvin and Gertz energy consultancy in Singapore.
Saudi Arabia s cabinet on Monday asked Oil Minister Ali Al-Nuaimi to convene the meeting of producer and consumer nations, and oil firms, to discuss the jump in prices, its causes and how to deal with it objectively.
The meeting will take place on June 22 in the Saudi city of Jeddah, Abdalla El-Badri, secretary general of the Organization of the Petroleum Exporting Countries (OPEC), told AFP.
European countries, the European Commission, the International Energy Agency (IEA) – the energy watchdog for industrialized countries – and the heads of investment banks Morgan Stanley and Goldman Sachs would be invited, he said.
The United States, the world s biggest energy consumer, will also participate, a White House spokesman said on Tuesday.
Analysts in the Gulf said the call for the meeting was aimed at showing that OPEC states were not responsible for the price surge.
OPEC maintains that the oil market is well supplied and current prices do not reflect the fundamentals of supply and demand.
Saudi Arabia, a close Western ally, has come under huge US pressure to boost output.
Ahead of the Jeddah meeting, finance ministers from the Group of Eight (G8) rich nations will gather in Japan this weekend to discuss ways to limit the economic damage of soaring oil prices, which have eclipsed the credit crisis as their biggest worry.
A global backlash over high fuel prices escalated on Tuesday. Truck drivers were killed in Spain and Portugal while manning picket lines, and violent protests spread to India.
But Shum said there was not much the G8 nations could do in the near term in the face of slowing global demand and a tight oil market.
The Paris-based IEA said Tuesday it expected global oil demand to average 86.8 million barrels per day this year, 80,000 fewer barrels than its estimate last month.
It said the downward revision took account of the reduction of price subsidies in several countries.
Malaysia has raised petrol prices 41 percent in a bid to curb its massive subsidies bill, following a similar move in Indonesia, where fuel prices jumped by almost 30 percent. India s government also raised pump prices.
The IEA said the supply situation remains tight, while in the industrialized nations of the Organization for Economic Cooperation and Development, oil demand is falling.
Oil prices have surged since breaking through the $100 level at the start of the year, and analysts see prices hitting $150 soon. -AFP
