OPEC meeting underway, higher oil prices in 2010?

Members of the oil producers’ body OPEC are meeting in Angola’s capital today but analysts expected the group to leave its oil production quotas unchanged.

The OPEC decision could be a calculated risk that unexpected global events will push crude much higher than $75 in 2010. There have been several incidents in the last week alone that show oil prices could destabilize and rise quickly. Royal Dutch Shell said it would try to sell its Nigeria fields for $5 billion. Continued attacks by rebels on the pipelines in the African nation have disrupted supply.

Iranian forces attacked an Iraqi oil field on December 20. They have withdraw from the field but are still on Iraqi land. Iraq is also faced with attacks on some of its pipelines by rebels in its northern regions.

Members of the OPEC cartel may be able to sit back and claim that they have done nothing to increase oil prices: They will hold supply steady and indicate that they have, to the best of their ability, matched supply and demand. Then they can let the political and military messes in other countries push oil prices higher as 2010 progresses.

Tags:  2010, meeting, oil prices, OPEC