Oil held near $53 a barrel this afternoon as investors balanced mild weather in the United States with the prospect exporter group OPEC may lower supply further to boost prices.
Kuwait's oil minister said today the Organization of the Petroleum Exporting Countries may hold an emergency meeting after February 1st should prices fall further. Oil touched a 19-month low below $52 last week.
"Prices sank to quite low levels last week so the market is expecting some sort of reaction from OPEC," said Tobin Gorey, an analyst at Commonwealth Bank.
"It is possible that they (OPEC) will announce more cuts, I wouldn't rule that out, but what the market is going to be impressed by is compliance with the cuts."
US crude was down 10 cents at $52.89 by 12.01am. Brent crude for February, which expires on today, was up 9 cents to $53.04.
Floor trading at the New York Mercantile Exchange is closed on Monday for Martin Luther King Jr. Day, but electronic markets remain open.
Oil's slide this year as mild weather in the United States curbed heating fuel demand is worrying OPEC, which has been cutting supply since November to stem crude's drop from a record high of $78.40 hit in July.
The group pledged to lower supply by 1.2 million barrels per day from November 1st. Meeting in Abuja, Nigeria, last month, OPEC agreed to trim output by a further 500,000 bpd from February 1st.
Kuwait's oil minister, Sheikh Ali al-Jarrah al-Sabah, said on Monday OPEC may meet should prices fall further, though he preferred to wait until after the latest cutback took effect.