Oil Hits Fresh 32-Month Highs
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Updated 4:33 PM ET September 27, 1999
LONDON (Reuters) - World oil markets held firm Monday
after powering to fresh 32-month highs on technicals and news
that Iraq would surpass its $5.26 billion oil sales limit in early
October.
London Brent futures for November closed 17 cents higher on
the day at $24.07 a barrel after steaming ahead to a high of
$24.18 after the release of U.N. figures showing that Friday,
Iraqi oil exports were $695 million short of hitting their six-month
limit.
Using the four-week averages of price and exports, Iraq will
exceed the sales target allowed by the UN by October 8.
Iraqi oil exports under the current six-month phase of the
"oil-for-food" program, which ends November 20, reached 2.63
million barrels per day in the week to September 24.
The upward move in London, which was not mirrored in New
York, was helped by a rally late last week when OPEC voted to
leave export restrictions in place.
Analysts said OPEC's decision to maintain 4.3 million barrels a
day of supply curbs until April looked likely to push prices higher
again as inventories were depleted in coming weeks.
"The outcome of the meeting almost assures the world of a
serious stockdraw over the next 90 days," said independent U.S.
oil consultant Philip Verleger in a note to clients.
Dealers Monday said they remained wary of political pressure in
the United States to release oil from the national strategic
petroleum reserve.
The U.S. Department of Energy said Friday there was no need
to consider a sale from the reserve because commercial heating
oil stocks were sufficient.
A U.S. senator, Charles Schumer of New York, had called for a
release of oil to counter OPEC export curbs calling them nothing
less than "economic warfare."
"Ultimately any sale from the reserve will be politically motivated
and for that reason we would not rule out pressure for such a
sale increasing over the coming months," said Lawrence Eagles
of oil brokers GNI.
The risk of a big price reversal led by speculative hedge funds
was reduced Friday when U.S. statistics showed a decline from
the record purchase positions held by speculators.
The Commodities and Futures Trading Commission said
speculators' net long positions in U.S. light crude futures had
fallen nine percent to 71,500 contracts in the two weeks to
September 21.
Prices in dollars per barrel:
Sept 27 Sept 24
(close) (close)
IPE Nov Brent 24.07 23.91
NYMEX Nov light crude 24.61 24.80 |
