Crude oil prices tipped to rise

23 February 2009

The price of crude oil could begin to rise as Opec supply cuts begin to take effect on the market, an official has claimed.

According to the official Islamic Republic News Agency, National Iranian Oil Company managing director Seifollah Jashnsaz said values could begin to recover in the near future, Reuters reports.

Opec has reduced oil production by more than four million barrels a day since September in a bid to halt the recent slide in prices and values rose by 14 per cent in one day last Thursday.

Mr Jashnsaz said that the supply cuts, as well as reports last week that worldwide demand for oil was beginning to increase, could help stage a recovery in the market.

"The decisions adopted in the previous two Opec meetings and the compliance of member states with their output cuts have brought a relative increase in the price of oil in the market," he stated.

Despite Mr Jashnsaz's optimism, home heating oil customers saw crude oil prices fall back below $39 (£27) a barrel on Friday as the ongoing global recession continued to affect the market.

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