Oil prices ease upward trend as OPEC promises to boost supplies

| 1/7/2003

World oil prices pulled back from two-year highs Jan. 6 after the OPEC cartel said it would up output to cover lost supplies caused by trouble in Venezuela, Reuters reports.

International benchmark Brent crude oil fell 22 cents to $30.55 a barrel, while U.S. crude futures eased 36 cents to $32.72. Both markers are within a dollar of two-year highs.

Meanwhile, a 5-week-old oil strike in Venezuela, which held exports at one-fifth of normal levels last week, has drained U.S. stockpiles to near their lowest levels in 26 years.

OPEC told Reuters it would use an informal mechanism to keep prices in a range of $22-$28 a barrel, which will trigger a supply hike Jan. 15 if prices stay up.

OPEC powerhouse Saudi Arabia and its Gulf ally, the United Arab Emirates, have endorsed a price mechanism that triggers extra supply when OPEC's basket of seven crudes exceeds $28 for 20 days. OPEC's basket stood at $30.83 a barrel Friday, its 13th day above the target.