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November 27, 2007
VIENNA, Austria -- Oil prices continued to slide Tuesday on growing expectations that OPEC ministers will raise crude production following a meeting next week, according to the Associated Press.
A sharp sell-off on Wall Street overnight contributed to a decline in oil futures.
Crude's ascendancy has been stymied in recent weeks in part by conflicting signals from members of the Organization of Petroleum Exporting Countries about their willingness to add supplies to the global oil market. Iranian Oil Minister Gholam Hossein Nozari appeared to remove one of the obstacles to increased OPEC supplies over the weekend when he said his country is willing to lift production if needed.
"If statistics and data indicate there is a need to produce more oil, we have the capacity to increase the output and supply more oil for the market," Nozari told reporters.
Many traders believe Saudi Arabia is pushing for production increases against opposition from Iran, Venezuela and other OPEC members. CNBC reported Monday that Saudi Arabia has already boosted its oil output. Analysts said that confirms reports last week by two research firms that found OPEC production is rising faster than expected.
But Vienna's PVM Oil Associates noted that OPEC's seaborne oil exports in the first half of November dropped 340,000 barrels a day from the second half of October to 22.48 million barrels a day.
"The outage of major UAE fields due to maintenance was partly ... responsible for the developments," PVM said. It also noted U.S. National Weather Center predictions for colder than normal temperatures in the next 10 days - which could drive up heating oil demand.
Light, sweet crude for January delivery dropped $1.09 to $97.61 a barrel by midday in Europe in electronic trading on the New York Mercantile Exchange. The contract fell 48 cents to settle at $97.70 Monday.
Posted by Peter C. T. Elsworth 
at 9:10 AM to Crude oil market
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