Some OPEC ministers are hinting that the group may relent and postpone the planned output cut, since prices have shown no signs of tailing off in line with the warmer northern hemisphere winter. 'The delay is possible if we find that the surplus is less than 3.5 million barrels and prices are high because of demand,' said Kuwaiti Oil Minister Sheikh Ahmad al-Fahd al-Sabah in late March.

Others are determined to stand firm, pointing out that price levels are not justified by fundamentals. 'Algeria feels that the decision that was made in Algiers on 10 February is a prudent and precautionary measure to avoid a tremendous fall in oil prices,' said Algerian Energy & Mines Minister Chakib Khelil on 22 March. Riyadh has yet to express a view.

Analysts agree about the anomalous state of the market. 'The complicating factor for OPEC is that current prices are not being driven by global balances,' says Paul Horsnell, analyst at Barclays Capital. 'They are not even being driven by the overall tightness of the US market. The heat in prices is being caused by US gasoline balances, and that situation still does not look pretty.' US crude inventories built by an unusually strong 7.5 million barrels in the week to 19 March, reaching 288.6 million barrels. But gasoline stocks fell again, during the window between peak heating oil and peak gasoline demand when they should be climbing.

In Iraq, the positive story of recent weeks, which have seen output in the south climbing close to pre-war levels and the northern export pipeline reopening, was marred by an accident on 24 March. A fire broke out at the Al-Faw storage terminal between the main southern fields and the Basra Export Terminal. The incident was blamed on poor maintenance rather than sabotage, but prices immediately rose on the news.