4 Feb 2009

Oil price rises as OPEC mulls deeper supply cuts

6:46 pm on 4 February 2009

Oil prices rose on Tuesday after OPEC signaled it might deepen its record output cuts to help boost prices and reduce stockpiles.

US light crude for March delivery rose 70 cents to settle at $US40.78 a barrel, while London Brent rose 26 cents to $US44.08 a barrel.

The president of the Organization of Petroleum Exporting Countries told Reuters on Tuesday the group could add to its agreed output cuts of 4.2 million barrels per day when it meets on 15 March.

Slowing economic growth in the United States, China, Japan and other major consumers has dampened fuel use, swelled stocks and knocked more than $US100 a barrel off the price of crude since its July peak of $US147.

OPEC has aggressively countered the consumption slowdown with deep output cuts and a Reuters survey showed the group, which pumps a third of the world's oil, had carried out about 67% of its production curb in January.