Saturday, June 20, 2009
NEW YORK: Oil prices fell below 70 dollars on profit-taking on Friday after a brief rally spurred by hopes that the worst may be over for the ailing global economy.
Early gains were also supported by continuing attacks on oil facilities in Nigeria and concerns about political developments in Iran, OPEC's second largest producer, following disputed presidential elections there.
New York's main futures contract, light sweet crude for delivery in July, shed 1.82 dollars from Thursday's close to end at 69.55 dollars a barrel after climbing past 72 dollars.
In London trade, Brent North Sea crude for August delivery dropped 1.87 dollars to 69.19 dollars per barrel.
Traders said prices came under pressure ahead of Monday's expiry of the New York futures July contract.
"It put downward pressure into the close," said Phil Flynn of Alaron Trading.
Positive US data and stronger demand has driven the market in recent days, fueled also by unrest in key oil producing nations.
"We will be going into the weekend with some legitimate geopolitical concerns," said Olivier Jakob, analyst at Swiss-based research group Petromatrix.
"We will need to keep an Iranian risk premium for the weekend and to it we will add a Nigerian risk premium," he added.
Since the recession hit the global economy, concerns about geopolitical issues have rarely featured as a market driver, analysts at JPMorgan Commodity Research said in a note to clients. "But after a muted response to the disputed Iranian elections, and lethargy to ongoing Nigerian disruptions, there seems to be a more significant response," they said.
Iran's supreme leader Ayatollah Ali Khamenei on Friday called for an end to street protests over last week's disputed presidential election, siding with declared winner Mahmoud Ahmadinejad.
Making his first public appearance after daily protests over the official results, Khamenei ruled out any major fraud in the poll and warned that the defeated candidates would be held to account over any violence on the streets.
In Nigeria meanwhile, the country's main militant group said it destroyed early Friday a major pipeline supplying crude oil to Italian oil group Agip's Brass exports terminal.
On Thursday, the Movement for the Emancipation of Niger Delta (MEND) also claimed it destroyed a major crude oil pipeline belonging to Royal Dutch Shell as it stepped up a campaign against foreign oil companies in the country.
Unrest in the Niger Delta has reduced Nigeria's oil output sharply to 1.8 million barrels per day, according to the latest June report of the International Energy Agency, from 2.6 million barrels in 2006.
Oil prices touched multi-year lows of around 32 dollars in December as the economic slowdown crushed demand for energy but they have slowly clawed their way back since then.
(AFP)
NEW YORK: Oil prices fell below 70 dollars on profit-taking on Friday after a brief rally spurred by hopes that the worst may be over for the ailing global economy.
Early gains were also supported by continuing attacks on oil facilities in Nigeria and concerns about political developments in Iran, OPEC's second largest producer, following disputed presidential elections there.
New York's main futures contract, light sweet crude for delivery in July, shed 1.82 dollars from Thursday's close to end at 69.55 dollars a barrel after climbing past 72 dollars.
In London trade, Brent North Sea crude for August delivery dropped 1.87 dollars to 69.19 dollars per barrel.
Traders said prices came under pressure ahead of Monday's expiry of the New York futures July contract.
"It put downward pressure into the close," said Phil Flynn of Alaron Trading.
Positive US data and stronger demand has driven the market in recent days, fueled also by unrest in key oil producing nations.
"We will be going into the weekend with some legitimate geopolitical concerns," said Olivier Jakob, analyst at Swiss-based research group Petromatrix.
"We will need to keep an Iranian risk premium for the weekend and to it we will add a Nigerian risk premium," he added.
Since the recession hit the global economy, concerns about geopolitical issues have rarely featured as a market driver, analysts at JPMorgan Commodity Research said in a note to clients. "But after a muted response to the disputed Iranian elections, and lethargy to ongoing Nigerian disruptions, there seems to be a more significant response," they said.
Iran's supreme leader Ayatollah Ali Khamenei on Friday called for an end to street protests over last week's disputed presidential election, siding with declared winner Mahmoud Ahmadinejad.
Making his first public appearance after daily protests over the official results, Khamenei ruled out any major fraud in the poll and warned that the defeated candidates would be held to account over any violence on the streets.
In Nigeria meanwhile, the country's main militant group said it destroyed early Friday a major pipeline supplying crude oil to Italian oil group Agip's Brass exports terminal.
On Thursday, the Movement for the Emancipation of Niger Delta (MEND) also claimed it destroyed a major crude oil pipeline belonging to Royal Dutch Shell as it stepped up a campaign against foreign oil companies in the country.
Unrest in the Niger Delta has reduced Nigeria's oil output sharply to 1.8 million barrels per day, according to the latest June report of the International Energy Agency, from 2.6 million barrels in 2006.
Oil prices touched multi-year lows of around 32 dollars in December as the economic slowdown crushed demand for energy but they have slowly clawed their way back since then.
(AFP)
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