Oil prices mixed on eve of OPEC meeting

Oil prices diverged today, the eve of OPEC's meeting to decide on crude output levels, as investors kept a close watch over vital Ukraine-Russia gas talks.
Brent North Sea crude for delivery in July fell 41 cents to stand at USD 109.58 a barrel in late London trading, compared with yesterday's closing value.
US benchmark West Texas Intermediate (WTI) for July gained 12 cents to USD 105.06 a barrel.
Prices had rallied yesterday as investors cheered robust economic data from the US, China and Japan. A breakdown of initial Ukraine-Russia talks to avert a gas cut-off also boosted prices, traders said.

Brent, a benchmark for the pricing of Middle Eastern crude, "has been consolidating within the recent range of USD 109-110 per barrel... As investors remain cautious ahead of the crucial OPEC meeting in Vienna" on Wednesday, noted Sucden brokers analyst Myrto Sokou.
"Market participants will watch carefully for any signs of clarification ... From major oil supplier countries."

OPEC is widely expected to stick by its oil output ceiling tomorrow, as supply tensions linked to global crises help to keep crude prices high, benefiting producers.
The Organisation for Petroleum Exporting Countries, whose dozen member nations together supply about one third of the world's crude, is widely expected by experts to keep its daily output ceiling at 30 million barrels of oil.

While OPEC is satisfied with current price levels at about USD 100 a barrel, the cartel is in fact pumping below its collective target owing to abundant supplies in top crude consumer the United States.
Offsetting this are worries of potential supply strains as Ukraine risks sliding into all-out civil war.
Investors are concerned that a full-blown conflict in Ukraine would disrupt supplies and send energy prices soaring. Russia accounts for nearly 40 per cent of EU gas imports, with half of that transiting through pipelines in Ukraine.
Ukraine's week of tough negotiations with Russia, aimed at ending a separatist insurgency and averting a gas cut-off, got off to a rocky start as a round of gas talks broke up early today without a deal before restarting again in the evening.