Members of Opec, the oil cartel, are seriously considering raising supply for the first time since 2007 in order to dampen prices that are currently above $100 per barrel.
Ahead of a key meeting next week, an Opec official said the world could do with an extra 1m barrels of oil per day to reduce volatility in the market.
The 12-member group of oil-producing countries had not been expected to raise output, despite the fact that London prices went above $125 per barrel during tensions in the Middle East.
However, a number of officials appear to be increasingly open to a rise in output.
Ali Al-Naimi, the Saudi oil minister, said on Thursday that the cartel was prepared to act if necessary. “We have to wait and see the data. If there is a need for an increase, we would decide accordingly,” he said.
His comments came as oil prices unexpectedly fell below $100 per barrel in the US, as supplies continue to build up and demand has begun to fall
Paul Spedding, an analyst from HSBC, also estimated that speculation had added $30 per barrel to the oil price from October to May.