LONDON, Jan 15: World oil prices steadied Monday amid prospects that the Organisation of Petroleum Exporting Countries might cut production to prevent prices from falling further, dealers said.

Prices have plunged by as much as 15 per cent since the start of 2007, owing largely to mild winter weather in the northern hemisphere. That has sparked speculation that Opec could hold an emergency production meeting.

In London on Monday, the price of Brent North Sea crude for February delivery rose 16 cents to 53.11 dollars per barrel in electronic trading.

New York's main oil futures contract, light sweet crude for delivery in February, dipped 18 cents to 52.82 dollars per barrel in pit trading.

“Opec might be further galvanised to take action,” said Victor Shum, an analyst with Purvin and Gertz energy consultancy.

Last week, prices fell to levels last seen in June 2005 because of unusually warm winter temperatures both in the US and Europe, which have slowed demand for heating oil.

The US Department of Energy said last week that US reserves of distillates — which include heating fuel — and gasoline (petrol) had risen sharply, offsetting a bigger-than-expected drop in crude reserves.

“Prices have dropped because the northern hemisphere winter has been a non-event so far, causing heating oil and gasoil demand and price strength to be much less than previously expected,” said Calyon analyst Mike Wittner. The warm winter comes at a time when stockpiles of US energy products are deemed by the market to be at a high level -- and has prompted energy demand to dive.

“Opec must match the lower crude demand with lower crude supply,” concluded Wittner.

“In our opinion, this will happen and we believe that Opec cuts will be effective.” Over the weekend, Iran and Venezuela had called for new Opec oil production cuts to support weakening prices.

Opec ministers decided last month at a meeting in the Nigerian capital to cut output by 500,000 barrels per day (bpd) from February.

The move followed Opec's reduction of 1.2 million bpd that became effective in November.

The NYMEX oil market remained open for normal floor trading later Monday despite the Martin Luther King holiday.

—AFP