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Oil prices slip after slumping 10 dollars in two days
AFP
Thursday, July 17, 2008
LONDON (AFP) — Oil prices fell again on Thursday after slumping by more than 10 dollars over the past two days on prospects that slowing economic growth would cut demand for crude, traders said.
New York’s main oil contract, light sweet crude for August delivery, lost 79 cents to 133.81 dollars a barrel, after dropping 4.14 dollars on Wednesday and 6.44 dollars on Tuesday, the sharpest daily decline since January 1991.
London’s Brent North Sea oil for September lost 73 cents to 135.08 dollars. The Brent August contract expired Wednesday down 2.56 dollars at 136.19 dollars.
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Sucden analyst Nimit Khamar said the market was supported by strong fundamentals of supply and demand in the long term.
However, he added: “In the short term there is a real concern about the health of economies globally.”
- A d v e r t i s e m e n t
Prices have crumbled since striking record highs above 147 dollars last Friday and losses accelerated on Wednesday after a bigger-than-expected rise in US crude reserves, analysts said.
“Oil prices fell sharply (on Wednesday) largely driven by an unexpected weekly rise in US oil and gasoline inventories,” said Barclays Capital analyst David Woo.
US crude inventories rose 3.0 million barrels in the week ending July 11, confounding market expectations for a decline of 2.2 million barrels.
“The inventory report essentially indicated oil demand in the US is just very poor,” said Victor Shum, a Singapore-based analyst with energy consultancy Purvin and Gertz.
Traders were also watching developments in the Middle East after what appeared to be a shift in US policy toward Iran announced late Tuesday, which likely would impact the oil market, analysts said.
The United States said it was sending Under Secretary of State William Burns to nuclear talks on Saturday between Iran’s nuclear negotiator, Saeed Jalili, and the European Union’s foreign policy chief, Javier Solana.
The US and other Western powers have been locked in a long-running stand-off with Iran over its nuclear drive.
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