World
  |
|
Oil prices mixed as market weighs economic outlook, supplies
AFP
NEW YORK
Petroleumworld.com 03 14 07World crude oil prices ended mixed Tuesday after an influential energy watchdog warned of a potential supply crunch in many industrialized nations.
Traders were anticipating no change to output from the Organization of the Petroleum Exporting Countries, which opened informal talks in Vienna ahead of a full ministerial meeting Thursday.
New York's main oil futures contract, light sweet crude for delivery in April, lost earlier gains to finish 98 cents lower at 57.93 dollars a barrel.
In London, Brent North Sea crude for April delivery also lost steam in late trading but managed just to stay ahead, adding 16 cents from Monday's settlement to 60.90 dollars a barrel.
New York futures tracked Wall Street share prices lower in late trade, as data showing rising rates of mortgage delinquencies exacerbated fears about a slowing US economy.
Fimat energy vice president Don Luke said an increased number of tankers entering the Houston Ship Channel, which has been closed repeatedly by bad weather in recent weeks, had helped to drive crude down in New York.
"And investors were dumping crude on the news leaking out from Wall Street, given the fears for the US economy," he said, as the Dow Jones share average ended down nearly 250 points.
In earlier trade, prices surged after the "bullish news" from the Paris-based International Energy Agency, according to Sucden analyst Michael Davies.
The IEA "said that oil inventories in industrialized countries are likely to score their largest first-quarter decline in over 10 years, following OPEC production curbs," he said.
"In addition, colder weather in the US in February is also expected to take its toll on oil stocks."
The US Department of Energy publishes its weekly snapshot of American energy stockpiles on Wednesday.
The warning from the IEA, which was founded to advise its 26 member states on energy policy during the oil shock of 1973-74, came in the group's latest monthly report.
"Tighter OPEC supply and colder temperatures in the US in February served to perpetuate the recent downward trend in OECD stocks," the IEA said.
It said that preliminary data suggest that OECD stocks have fallen by over 1.26 million barrels per day (bpd) over the first two months of the year, "and could be heading for the largest quarter stock draw for over 10 years."
The Organization for Economic Cooperation and Development (OECD) covers 30 of the world's most industrialized countries, including the United States, western European states, Japan, Australia and South Korea.
Data for January and February show "reason to be concerned" and recent declines in crude as well as gasoline and distillate stocks bring inventories to "levels that were associated with higher and sharply rising prices last summer," the IEA said.
Crude oil topped a record 78 dollars a barrel in mid-2006, but then started a steady slide. The retreat prompted OPEC to cut production late last year in a bid to support prices.
OPEC members Iran and Kuwait predicted Tuesday the cartel would not agree a further output cut in Vienna this week.
"We don't see a need for reducing oil production at present. There is a balance between supply and demand and the price is good," Kuwaiti Energy Minister Sheikh Ali Jarrah al-Sabah said, quoted by the KUNA news agency.
OPEC ministers agreed to cut output by 1.2 million bpd, starting in November, followed by another cut of 500,000 bpd that was due to have begun on February 1 this year.
Ministers from the powerful cartel, which supplies more than a third of the world's crude oil, are forecast to maintain its official production quota of 25.8 million bpd on Thursday.
AFP 13 2035 GMT 03 07
Copyright© 2007 AFP. All Rights Reserved.
Your
feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com
Any
question or suggestions, please write to:
editor@petroleumworld.com
Best
Viewed with IE
5.01+
Windows
NT 4.0, '95, '98 and ME +/ 800x600 pixels