New High

Sumith Arangala, Chief Executive Officer, LVL Energy Fund (left) handing over the agreement to Nanda Fernando, Managing Director, Sampath Bank

VIENNA, Sept 11, 2007 (AFP) – OPEC exporters agreed Tuesday to pump an extra 500,000 barrels of oil a day to cool near-record crude prices, in a victory for Saudi Arabia over its reluctant partners. Analysts said that while the gesture would ease fears about a supply crunch heading into the northern hemisphere winter, the peak demand period for oil, it would be unlikely to lower prices significantly.

Tuesday evening, New York’s main futures contract, light sweet crude for delivery in October climbed 74 cents to close at 78.23 dollars per barrel, a record closing high, near its all-time intraday high of 78.77 dollars hit August 1.

The 12-member cartel said Tuesday it would open the taps from the beginning of November amid concerns that high oil prices could drag down the world economy, already suffering from the consequences of the US housing crisis.

OPEC’s decision “will take some of the near-term supply concerns off, but shouldn’t put too much downward pressure on markets,” said analyst David Kirsch from Washington-based consultancy PFC Energy.

Analyst John Hall from London-based John Hall Associates called the move a “token gesture.”

“It’s a step in the right direction tha