NEW YORK (CNNfn) - Oil prices dipped lower Thursday morning as traders grappled over OPEC's decision on whether to increase production and boost supply.
Analysts said the Organization of Petroleum Exporting Countries (OPEC) was sending mixed signals as to whether they would increase production ahead of its scheduled June 21 meeting in Vienna, after crude oil rose above the key level of $28 a barrel Wednesday.
The so-called price band, or the $22 to $28 price range, was established as an informal pact at the cartel's last meeting in late March. Under the pact, if prices were to exceed the range, the organization would take steps to offset the higher prices by lifting production by 500,000 barrels.
In New York, July crude oil futures last traded down 7 cents at $29.88 per barrel. In London, Brent crude for July delivery eased 19 cents to $29.03.
However, OPEC officials are expected to wait until its next meeting before reaching a decision. "Something will happen at the June 21 meeting," said James Falvey, oil analyst at Dresdner Kleinwort Benson in Boston. "If oil prices continue to stay in the $29 to $30 range, you will see action."
OPEC President and Venezuelan Oil Minister Ali Rodriguez Thursday expressed caution regarding any potential output boost. "We have to be extremely cautious before taking this decision. We have to observe if this is a short-term phenomenon or if it will be sustained, and then we will take a decision," he said.
In the meantime, Falvey said the cartel will make an effort to keep prices lower by verbally "talking it down." 
--Reuters contributed to this report.
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