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Oil prices continue downward trend
LONDON, England (CNN) -- Oil prices continued their week-long decline on Friday as traders said increased output more than compensated for the suspension of exports from Iraq. Prices headed lower on Friday after a rise at the start of the day, which followed reports that Iraqi troops were setting fire to oil wells in the south of the country, which generate 60 percent of Iraq's oil. Energy markets showed growing confidence in the Organization of the Petroleum Exporting Countries (OPEC), the cartel led by the world's largest producer, Saudi Arabia. OPEC says the world will not run short of oil, despite the war in Iraq. Nymex crude -- the oil blend traded on the New York Mercantile Exchange -- lost 37 cents to $27.75 per barrel in electronic trading. In the past three weeks, the price has fallen about 30 percent from a peak of $39.99 on hopes that a short war will not cut into the world's oil production capacity. In London, Brent crude dropped 46 cents to $25.04 a barrel. OPEC president Abdullah al-Attiyah said Thursday the group was resolved to raise production to make up for any oil shortfall resulting from fighting in Iraq. Members of the cartel are authorized to use their spare capacity to produce more oil than their officially agreed daily quotas. OPEC's total output is now up by 300,000 barrels a day from November 2002 levels, London's Centre for Global Energy Studies told Reuters. However, OPEC member Iran has condemned attempts to officially sanction increasing output. It opposes any move it believes would give implicit backing to the U.S.-led attack on Iraq. At a meeting last week, Iran blocked moves to hike the cartel's agreed production limit from 24.5 million barrels a day. An adviser to Iran's oil minister said Friday any increase in that limit would be "a violation," the country's official news agency IRNA reported.
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