SINGAPORE Oil prices rose above $85 a barrel Monday in Asia

SINGAPORE Oil prices rose above $85 a barrel Monday in Asia after a massive loan offer to Greece by European countries helped weaken the dollar, making crude cheaper for investors holding euros.Benchmark crude for May delivery was up 50 cents to $85.42 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract lost 47 cents to settle at $84.92 on Friday.The finance ministers of the 15 eurozone nations agreed Sunday to offer euro 30 billion ($40 billion) in loans to Greece this year if Athens asks for the money.

The promise – filling in details of a March 25 pledge of joint eurozone-IMF help – was another attempt to calm markets that have been selling off Greek bonds in recent days.The euro rose to $1.3657 on Monday from $1.3322 on Friday while the dollar fell slightly to 93.10 yen.

Oil was down the previous three days on investor concern that slowly recovering U.S. crude demand doesn’t justify further gains. Crude jumped 25 percent to above $87 last week from $69 in early February.”If oil markets continue to take cues from supply and demand – in preference to the dollar, equities or economic data – we cannot paint a picture that includes higher prices,” Cameron Hanover said in a report.

In other Nymex trading in May contracts, heating oil added 1.17 cents to $2.2377 a gallon, and gasoline gained 1.17 cents to $2.3010 a gallon. Natural gas rose 3.0 cents to $4.100 per 1,000 cubic feet.In London, Brent crude was up 64 cents at $85.47 on the ICE futures exchange.(AP)

OPEC price hawks like Iran and Venezuela are happy with present prices near $80 a barrel

VIENNA With U.S. demand for oil lackluster, even traditional OPEC price hawks like Iran and Venezuela are happy with present prices near $80 a barrel as they head into Tuesday’s meeting of the 12-nation organization.These two countries traditionally are the greatest advocates of tight OPEC supply. But ahead of their meeting there is informal unanimity among OPEC oil ministers that – with the world’s economic recovery feeble at best and crude prices at preferred levels – it’s best not to rock the boat.

That means the ministers will likely agree to maintain OPEC’s formal production target, now at 26 million barrels a day – a benchmark set over one year ago.OPEC has left its members’ production quotas unchanged since December 2008, when it announced the last of a series of cuts aimed at bringing their output down by 4.2 million barrels per day. The cuts helped engineer a rebound in crude prices, which had collapsed to the low $30s from a mid-2008 high of almost $150 per barrel.

Since the oil ministers last met three months ago, prices mostly have hovered between $70 and $80 a barrel – a range that most OPEC nations have factored into their national budgets this year. That has kept even hardliners Iran and Venezuela on board with other OPEC members.”OPEC should not take any decision to change production,” Iranian oil minister Masoud Mirkazemi told reporters in Tehran on Monday, echoing comments voiced by Rafael Ramirez, his Venezuean counterpart.Still, there will be behind-the-scenes pressure on some members to produce less by honoring their allotted targets.

At close to 27 million barrels a day, OPEC now is producing a daily 600,000 barrels above its official target – a result of cheating by individual nations on their quotas. While OPEC does not reveal which nations are overproducing, the Paris-based International Energy Agency put overall quota compliance within OPEC at only 58 percent in January.World oil demand is expected to rise this year due to surging economic activity in Asian countries, especially China. The IEA, which advises oil-consuming countries, predicts that the world’s appetite for crude will average 86.6 million barrels a day this year, or 1.6 million barrels a day more than 2009’s 86.5 million barrels.Still, oil markets remain concerned about shaky demand in the U.S. Crude consumption there and in other top industrialized nations is expected to contract in 2010 for the fifth consecutive year.(AP)