UPDATE 6-Oil drops towards $77 as market doubts OPEC cut
* UAE says OPEC should not panic, markets will "fix itself"
* Oil market "will stabilise itself" - Saudi oil minister
* Only U.S. economy shows signs of strength (Updates throughout, adds details, comments)true
By Jack Stubbs and Ahmed Aboulenein
LONDON, Nov 26 (Reuters) - Brent crude oil dropped towards $77 per barrel on Wednesday after Iran signalled OPEC was unlikely to push for a major change in oil output despite a collapse in prices.
Iranian Oil Minister Bijan Zangeneh said that OPEC members should "monitor the market carefully", a comment traders understood to mean that the cartel would not cut output when oil ministers from the Organization of the Petroleum Exporting Countries (OPEC) meet on Thursday in Vienna.
"This suggests that we won't get any decision on an output cut," said Michael Hewson, oil market analyst at CMC Markets in London. "We're probably going to see oil prices go down towards $70 a barrel."
Oil prices have dropped by a third since June and some OPEC members have called for the cartel to reduce production sharply in an attempt to tighten the market. Predictions for the OPEC meeting range from a large output cut to no action at all.
Benchmark Brent futures were down 70 cents at $77.63 a barrel by 1420 GMT, having hit a low of $77.30 in the session. U.S. crude was down 46 cents at $73.63.
Saudi Arabia, the cartel's largest producer and exporter, suggested on Wednesday it would not support an output cut at Thursday's meeting. Oil Minister Ali al-Naimi told reporters that he believed the oil market "will stabilise itself eventually".
His comments were echoed by Gulf producer United Arab Emirates. "The market will fix itself ultimately," UAE Oil Minister Suhail bin Mohammed al-Mazroui told Reuters in an interview.
Iraqi Finance Minister Hoshiyar Zebari told reporters he would soon present to cabinet a proposed 2015 budget based on an oil price of $70 per barrel. "This could fluctuate. You have no assurances or guarantees," he said.
Weak economic data from Asia's biggest economies further suppressed prices.
"The U.S. economy is doing great but most everyone else is struggling, creating more downside than upside risks to growth," U.S.-based PIRA Energy Group said in a weekly report.
China cut interest rates last week, indicating slowing growth, while Japan's economy slipped into recession in the third quarter.
The United States upgraded its reading on third quarter gross domestic product to 3.9 percent on Tuesday from 3.5 percent reported last month. (Additional reporting by Henning Gloystein in Singapore, and Alex Lawler, Amena Bakr and Rania El Gamal in Vienna; editing by Christopher Johnson and Jason Neely)
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- November 27, 2014
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