Oil jumps, OPEC agrees to keep output unchanged

Oil rose sharply on Wednesday after OPEC agreed to keep output levels unchanged at its meeting in Abu Dhabi, rebuffing consumer country calls for more oil to rein in prices now near $90 a barrel.

Nigerian oil minister Odein Ajumogobia said OPEC had agreed to keep supplies unchanged and would review this again at the end of January. Iran confirmed the deal.

Before the meeting, oil ministers had said they saw no reason to boost production because there was already enough oil to meet winter demand.

"We've seen nothing yet to justify an increase or a decrease," said Saudi Arabia's Oil Minister Ali al-Naimi.

U.S. crude was up $1.42 to $89.74 a barrel at 1102 GMT. London Brent crude rose $1.54 to $91.07 a barrel.

Brent has moved to a premium to U.S. crude this week for the first time since August.

Oil prices have risen about 40 percent since August and came close to breaking $100. But they have fallen about 10 percent since peaking at $99.29 on November 21, pressured by concerns that top oil consumer the United States could slide into recession.

Tensions between Tehran and Washington over Iran's nuclear program had also supported the rally in oil prices.

But a report released on Tuesday that grouped the findings of various U.S. intelligence agencies contradicted the Bush administration's earlier assertion that Tehran was intent on developing an atomic bomb.

Analysts said this could help reduce the so-called Iran risk premium in the oil price.

U.S. government data on oil inventories is due later on Wednesday. A poll of analysts by Reuters showed crude stockpiles are forecast to have fallen for the third week in a row.

Crude supplies are predicted to have dropped by 800,000 barrels in the week to November 30. Distillate stocks were seen down 300,000 barrels.

(Reporting by Jane Merriman in London and Luke Pachymuthu in Singapore; editing by James Jukwey)

source:reuters.com