Jan. 30 (Bloomberg) -- Crude oil rose for a third day in New York amid concern a dispute over Iran's nuclear program may reduce shipments from the world's fourth-largest producer.

Iran and the European Union are due to resume talks in Brussels today on Iran's nuclear program before the United Nations watchdog decides whether to refer the country to the Security Council for possible sanctions. Norwegian oil output may fall next month if talks fail to resolve a labor dispute. Production in Nigeria has been reduced by attacks on a pipeline.

``Prices will continue to remain high, near record levels, until there's a decision taken on the Iran issue,'' said P.K. Goyal, executive director at Indian Oil Corp., the nation's largest refiner, in New Delhi. ``The market is reacting because there is concern on supplies.''

Crude oil for March delivery rose as much as 66 cents, or 1 percent, to $68.42 a barrel in after-hours, electronic trading on the New York Mercantile Exchange. It traded at $68.25 at 8:01 a.m. London time.

On Jan. 27, oil gained $1.50, or 2.3 percent, to $67.76 on concern about the stand-off over Iran's nuclear research. Prices reached an all-time high of $70.85 on Aug. 30, the day after Hurricane Katrina crossed the U.S. Gulf coast. Oil has risen about 41 percent from a year ago.

``The Iranian issue is hanging over the market,'' said Tobin Gorey, a commodity analyst at Commonwealth Bank of Australia. ``There's a big bogey there in the form of Iran and these smaller issues that are making real impinges on supply.''

Nuclear Stand-Off

The Organization of Petroleum Exporting Countries, which produces more than a third of the world's oil, shouldn't cut production at its meeting tomorrow, Saudi Arabia's oil minister Ali al-Naimi said yesterday in Vienna. OPEC last month scheduled a meeting for Jan. 31 amid concern that a second-quarter seasonal lull would depress prices.

The group should ``absolutely not'' cut output, al-Naimi told reporters, echoing earlier comments from Algeria's Energy Minister Chakib Khelil.

Concerns about the dispute with Iran and supply reductions in Nigeria and Russia are pushing prices higher, said Gerard Burg, a minerals and energy economist at National Australia Bank Ltd. in Melbourne.

``There's enough uncertainty around that I don't think OPEC will be looking to cut production just at the minute,'' he said.

Eni SpA, Italy's largest gas company, said Jan. 29 it was getting less natural gas than requested from Russia for a 12th consecutive day amid freezing temperatures in eastern Europe. The coldest Russian weather in about 30 years is reducing oil output from some Siberian fields by as much as 4 percent, TNK-BP Chief Executive Robert Dudley said Jan. 27.

Iran

Iran, the Middle East's No. 2 oil producer, may be referred to the Security Council as early as this week following its decision in early January to resume research on the nuclear fuel cycle. In November 2004, Germany, Britain and France persuaded Iran temporarily to suspend uranium-enrichment activities, sparing the country from a U.S.-backed threat of sanctions at the UN Security Council.

Iran seems ``this time to be a bit more stubborn in pursuing this line,'' Burg said. ``Until we see some real progress from any talks, there's still going to be that uncertainty surrounding them.''

In Norway, negotiations between a labor union and employer representatives are due to start today to try to resolve a conflict over a tariff agreement for some Norsk Hydro ASA workers, a union leader said Jan. 27.

If an accord isn't reached, members of the ALT union at Norsk Hydro's Oseberg field in the North Sea may strike some time between Feb. 7 and Feb. 14, probably halting production at the project, he said.

Nigeria Attacks

A Nigerian militant group holding four foreign hostages from the oil industry on Jan. 27 threatened further attacks against Royal Dutch Shell Plc. Shell's Nigerian venture is losing 221,000 barrels a day in production, about 9 percent of the West African nation's output, since attacks on its operations began this month.

``It's a confluence of events, all these things are coming together to create further concern in the market,'' said Greg Canavan, senior equities analyst at Fat Prophets Funds Management in Sydney. ``We'd expect oil to continue to rise and breach the old high of $70.85 over the next quarter.''

Oil may rise in New York this week on concern Iran's resumption of nuclear research will lead to sanctions and cut off supply, a Bloomberg survey of 53 analysts showed. Thirty-one of the analysts surveyed, or 58 percent, said prices will rise this week, while nine forecast prices will decline and 13 expected little change.

Hedge-fund managers and other large speculators repositioned themselves in the New York oil futures market in the week ended Jan. 24 for a price rise, data from the U.S. Commodity Futures Trading Commission shows.

They reversed from a net-short position to a net-long position, with speculative long positions, or bets prices will rise, outnumbering short positions by 5,541 contracts, the Washington-based commission said in a Jan. 27 report.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net; Manash Goswami in New Delhi at mgoswami@bloomberg.net.

Last Updated: January 30, 2006 03:05 EST