Singapore: Oil prices fell in Asian trade Wednesday after Saudi Oil Minister Ali Al-Naimi said the world market is well supplied ahead of an Opec meeting next week, dealers said.
Speculation the Organization of Petroleum Exporting Countries (Opec) will decide to raise output at its meeting next Wednesday helped push prices lower, but the Saudi minister and Opec president Mohammad al-Hamli would not give a hint on the cartel’s next move.
Both ministers spoke at an energy forum in Singapore.
In Asian trade, New York’s main contract, light sweet crude for January delivery, slumped 56 cents to $93.86 a barrel from $94.42 in late US trades Tuesday.
The benchmark contract has fallen around five dollars since climbing close to the $100 mark last week, reaching a record high of $99.29.
Brent North Sea crude for January delivery tumbled 49 cents to $92.03.
“There is no relationship between the fundamentals today and the price of oil. There is a mismatch,” Al-Naimi told reporters after delivering a speech at an the energy forum.
During his speech, he said: “Fundamentals do not support high petroleum prices. The world market is well supplied.”
Asked whether Saudi Arabia, the world’s biggest oil exporter, will push for an increase in crude production at the Opec meeting, he said the cartel needed to see the data first.
Opec president al-Hamli, who is also the oil minister of the United Arab Emirates, would not comment on whether the cartel will raise output to cool down prices.
“We are going to meet next week and we will have a lot of information available. I’m not dropping any hints, you are going to spoil our meeting,” al-Hamli told reporters after speaking at the same forum.
“In Opec, when we meet as ministers, we look at the fundamentals. We look at the data and we base our decision on the data available at that time.”
Al-Hamli identified refining bottlenecks, geopolitical tension, risk hedging and speculation as among the factors driving oil prices higher.
Rising demand for heating fuel during the northern hemisphere winter should also add upward pressure on oil prices, other analysts said.
Opec last decided to raise output in September when it agreed to provide an extra 500,000 barrels of crude a day to the market, effective 1 November.