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Oil prices fall on profit-taking despite Nigeria concerns
AFP
NEW YORK
Petroleumworld.com 12 09 06World crude prices ended lower Friday on profit-taking after spiking earlier on concerns that Nigeria's oil facilities might be attacked ahead of an OPEC meeting there next week, traders said.
New York's main contract, light sweet crude for delivery in January, closed down 46 cents at 62.03 dollars per barrel. The contract had earlier surged to over 63 dollars before slumping.
In London, Brent North Sea crude for January delivery settled down 37 cents at 62.20 dollars per barrel.
"Across the board, we ran into some resistance points and once we failed to get through them, selling came in and profit-taking came in ahead of the weekend," said John Kilduff, an energy analyst with Fimat USA.
Sucden analyst Michael Davies said there was "concern about further attacks in Nigeria" that might target the west African state's oil infrastructure.
A militant group in southern Nigeria, responsible for previous hostage-takings, claimed responsibility for an attack Thursday on an Agip oil facility in which four foreigners were kidnapped and at least one person was killed.
"Fighters of the Movement of the Emancipation of the Niger Delta (MEND), attacked and destroyed the Agip installation in Brass in the Niger Delta," the group said in an e-mail statement sent to AFP in Lagos.
They threatened to launch further attacks on Nigeria's oil industry in "the following days".
Nigeria, Africa's biggest oil producer, derives over 95 percent of its foreign exchange earnings from oil, but unrest in the Delta has caused the country's daily output, normally some 2.6 million barrels, to drop by about 25 per cent.
The oil market was meanwhile gearing up for the OPEC meeting in the Nigerian capital Abuja next Thursday.
There is "continued concern over whether OPEC is going to cut their production quota again", Global Insight analyst Simon Wardell said.
The Organization of the Petroleum Exporting Countries is likely to propose a further production cut of 1.0-1.5 million barrels per day to support prices, Indonesian Energy Minister Purnomo Yusgiantoro said Friday.
At its last meeting in Qatar in October, the oil producers' cartel approved a reduction in its output quota of 1.2 million barrels per day to stem falling prices, which have dropped from record highs above 78 dollars this summer.
"There is continued talk that they will be cutting production ... the story is what will OPEC do next week?" said Stephen Rowles, an analyst with CFC Seymour.
AFP 08 2033 GMT 12 06
Copyright© 2006 AFP. All Rights Reserved.
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