$60 oil within reach, officials say

ALGIERS, Algeria, March 24 (UPI) -- Production cuts from the OPEC oil cartel stabilized oil prices and put $60-per-barrel oil within reach despite falling demand, the Algerian oil minister said.

Production cuts of 2.2 million barrels today enacted in January by the Organization of Petroleum Exporting Countries have stabilized oil prices in the world market. Prices hovered at around $45 since late last year but have spiked more than $50 in recent trading.

Algerian Oil Minister Chakib Khelil said that despite an estimated 1.1 million-barrel-per-day drop in demand, oil prices could reach $60 by the end of 2009, the Platts news service reports.

OPEC at its regular meeting in Vienna last week agreed to maintain current production quotas but said it would call for more compliance with previous reduction agreements.

The International Monetary Fund said the global economy would have negative growth for most of 2009, putting international markets into recession.

The global recession may translate to further declines in oil demand beyond the second quarter. Khelil said, however, that OPEC regulation was having a positive impact on the commodity.

"Despite all this, we have been able to stabilize oil prices and even push prices higher," he said.