London, Aug 02: Oil prices rose slightly on Friday after Opec agreed to keep output unchanged and analysts predicted the slow return of Iraqi crude exports could lead the cartel to leave production levels intact for the rest of the year. US light sweet crude was up 12 cents at $30.66 a barrel while London benchmark Brent crude rose 17 cents to $28.54. At a ministerial meeting in Vienna on Thursday, the Organisation of the Petroleum Exporting Countries decided to hold output at 25.4m barrels per day.
Some Opec insiders and analysts now believe the cartel will be able to avoid production cuts for the rest of the year as Iraq’s struggles to get oil flows back to pre-war levels will keep supplies tight and sustain high prices. Baghdad has only just reached output of one million barrels a day compared to pre-war capacity of 2.8 mbpd. Sabotage of infrastructure and damage from fighting has hampered efforts to restore flows.

“It’s unfortunate for Iraq, but depending on what happens there we could get away with doing nothing this year,’’ said a senior Opec delegate.
Analyst Adam Sieminski of Deutsche Bank said this meant little respite for those hoping for cheaper oil, particularly with oil stocks in US, the world’s biggest consumer, roughly 10% lower than a year ago. “Maybe we will have higher oil prices for a quite a while,’’ he said, adding, “Inventories are still low.’’ Bureau Report