Oil falls below $66 a barrel as supply fears fade

Mumbai: Oil prices skidded below $66 a barrel amid steady supplies and a build-up in US inventories. London Brent crude fell 15 cents to $65.18 while the US light crude hit a five-month low of $65.68 a barrel, down 19 cents in one day.

The price slide followed an early recovery of output from BP's giant Alaskan oil field and inventory data last week showing rising US fuel stockpiles. Expectations of a steady supply from OPEC also aided the sentiment.

Ministers of the Oil Producing and Exporting Countries (OPEC) are meeting in Vienna on Monday and traders do not expect any change in the output push that is helping to bring oil prices lower.

OPEC, which supplies 40 per cent of the world's crude, has kept its output target at 28 million barrels a day since July 2005 in a bid to ease record prices. That's unlikely to change now, said ministers from member-countries, including Saudi Arabia, Libya, Algeria and the United Arab Emirates.

The OPEC meeting is expected to accept a recommendation from its advisory committee that it keep current production ceiling unchanged. The grouping, however, will keep the door open for another meeting before December if prices drop sharply.

OPEC has been pumping crude at a faster pace amidst fears of a fall in demand for oil in 2007. The delay in any possible sanctions on Iran and a milder-than-forecast Gulf of Mexico hurricane season also helped bring prices down from a record $78.40 in July.