Oil prices are slipping in early morning trade Monday, and
traders will be monitoring closely the upcoming OPEC meeting in
Vienna to be held March 17.
The U.S. dollar's gains against major currencies too are keeping
oil prices from moving up, as are worries about the outlook for
China's economy in particular.
At 0745 ET, Brent crude is down 0.6% at $78.94 a barrel, while
light sweet crude is 0.4% lower at $80.93 a barrel, and natural gas
is down 0.6% at $4.37 a million British thermal units.
The Organization of Petroleum Exporting Countries will meet for
the first time in 2010 on Wednesday. Collectively, OPEC produces
about 40% of the world's total output, and includes Iran among its
member nations. Tehran has wanted to keep oil output unchanged,
while there is speculation that other member countries will call
for an output reduction amid sluggish growth worldwide.
China's National Development and Reform Commission did report
over the weekend, however, that electricity usage in the first two
months of 2010 rose 26% to 626.4 billion kilowatt hours compared to
the same period a year ago.
Meanwhile, a stronger greenback has made it more expensive for
other currency holders to buy dollar-denominated oil.
On the corporate front, the Australian Financial Review reported
that Arrow Energy Ltd. (
) could reject a joint takeover offer for its coal steam gas
business from Royal Dutch Shell (
) and PetroChina Co. (
) estimated at $3.03 billion. According to the Australian daily,
Arrow views the bid as too low, and the energy company is instead
coming up with its own plans for a natural gas project.
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