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Oil prices close in on 74 dollars a barrel
AFP
LONDON
Petroleumworld.com 08 30 07
World oil prices rose on Thursday, underpinned by a fall in US energy stockpiles and a partial recovery in equity prices after their recent plunge, analysts said.
New York's main futures contract, light sweet crude for delivery in October, gained 22 cents to 73.73 dollars per barrel.
In London, the price of Brent North Sea crude for October delivery climbed six cents to 72.19 dollars per barrel.
Crude futures were higher, "extending gains from yesterday (Wednesday), following unexpectedly large draws in gasoline and crude inventories during last week," Sucden analyst Michael Davies said.
"In addition, global stock markets were firmer, on speculations for a possible interest rate cut by the US Federal Reserve Bank, which could have a positive impact on equities and commodities," he added.
European and Asian share prices rose Thursday, though Wall Street was mixed.
The US Department of Energy (DoE) reported Wednesday that American crude oil inventories had plunged by 3.5 million barrels in the week ended August 24.
That was nearly six times more than the analyst consensus forecast of a 600,000-barrel drop.
"Many investors are concerned about the global supply and demand outlook for crude, citing that global supply could have troubles keeping up with the ever-increasing demand for energy," Sucden's Davies said.
In its regular weekly report, the DoE added that US gasoline inventories dived by 3.6 million barrels last week, more than the forecast of 2.5 million barrels.
Motor fuel inventories remain far below normal levels as US refiners have struggled to keep up during the peak demand of the holiday driving season, which began in May and wraps up this weekend with the Labour Day holiday.
"The gasoline decline really took the markets (by surprise) ... focusing attention on a very tight supply situation," MF Global analyst Edwards Meir said.
Meanwhile despite recovering stock markets, concerns over US economic health continue to affect oil trading, dealers said.
Traders' worries about oil demand in the United States, the world's biggest energy consumer, resurfaced Tuesday after a monthly survey showed US consumer confidence -- a key gauge of economic well-being -- had fallen amid a deepening housing market crisis.
But Wall Street roared back Wednesday from its heavy losses the previous day as global markets steadied following the US Federal Reserve's move to pump yet more money into creaky credit markets.
burs-bcp/adp
AFP 30 1528 GMT 08 07Copyright© 2007 AFP. All rights reserved.
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