Oil prices fall back on Opec hopes

Oil prices eased off highs last night amid signs that the Opec oil cartel was mulling a supply boost to smooth out the volatility in production and prices caused by the turmoil in Libya.

Brent crude for April delivery fell as low as $112.10 per barrel as Kuwait's oil minister, Sheikh Ahmad al-Abdullah al-Sabah, said the Organisation of the Petroleum Exporting Countries was in "consultations about a potential output increase", though no decision had been taken.

Another Opec member, Iran, signalled otherwise, suggesting that there was no shortage in the market. But the markets took solace from the fact that Opec members often implement informal increases in production, with the energy analyst Platts quoting sources that Saudi Arabia had started moving oil to the Red Sea for extra shipments to Europe.