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Oil prices fall as US motor fuel reserves climb
London (AFP) July 23, 2008 Oil prices fell further on Wednesday as traders digested stronger-than-expected gasoline (petrol) reserves in the United States, the world's biggest crude consumer, analysts said. The market also declined as Hurricane Dolly looked set to miss US energy installations in the Gulf of Mexico, they added. New York's main contract, light sweet crude for September delivery, dropped 1.79 dollars to 126.63 dollars pera barrel. London's Brent North Sea crude for September delivery shed 1.89 dollars to 127.66. Prices have tumbled by more than 20 dollars since striking record highs above 147 dollars on July 11. However, they remain at elevated levels after smashing through 100 dollars for the first time at the start of the year. The US Energy Information Administration said Wednesday that crude reserves fell 1.6 million barrels in the week ending July 18. Market expectations had been for a decline of 600,000 barrels. But the EIA added that gasoline stockpiles rallied by 2.9 million barrels. That outpaced analysts' consensus forecasts for a gain of 200,000 barrels and pointed towards flagging US demand for motor fuel. Oil prices have slumped since hitting record highs of 147.27 dollars in New York and 147.50 dollars in London earlier this month, as traders fretted over slower US economic growth dampening global demand for energy. On Wednesday, traders also kept a keen eye on weather developments in the Gulf of Mexico region, where many vital energy facilities are based. Hurricane Dolly was upgraded to a category two storm on Wednesday, gathering speed as it swirled over the Gulf of Mexico and prepared to make landfall near the Texas-Mexico border, the National Hurricane Centre (NHC) said. "Maximum sustained winds have increased to near 100 miles per hour (160 kilometres per hour) with higher gusts. Dolly is a Category Two hurricane on the Saffir-Simpson Scale," the NHC said. Some oil drilling companies in the area have evacuated personnel from their offshore rigs as a precaution. "Dolly now appears to have avoided any key offshore oil and gas production locations in the Gulf of Mexico," Barclays Capital analysts wrote in a note to clients. "The hurricane is expected to make landfall today (Wednesday) close to the US-Mexican border, and some risks remain that three refineries located in Corpus Christi on the Southern Texas coast may be affected." The Atlantic hurricane season, which began in June and usually lasts until the end of November, normally peaks from September onwards. Tropical storms in 2005, especially Hurricane Katrina, caused massive disruption to energy production in the Gulf of Mexico and pushed up oil prices to then record levels. burs/rfj/nh Related Links Powering The World in the 21st Century at Energy-Daily.com
Russia, Venezuela strengthen energy ties
Barvikha, Russia (AFP) July 22, 2008Leading oil and gas producers Russia and Venezuela will coordinate energy policies, Russian President Dmitry Medvedev said Tuesday after meeting his Venezuelan counterpart Hugo Chavez. |
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