LONDON (AP) -- Oil prices retreated Tuesday after a rally the day before lifted crude futures by almost $1 a barrel on worries that the recent drop in prices could prompt OPEC to cut production. Natural gas hit a new three-year low.
Light sweet crude for November delivery on the New York Mercantile Exchange fell 30 cents to $61.15 a barrel, reversing earlier gains, in electronic trading on the New York Mercantile Exchange by midday in Europe. The contract on Monday gained 90 cents to settle at $61.45 a barrel.
Brent oil was down 42 cents at $60.38 a barrel on the ICE Futures exchange in London.
Nymex heating oil futures were steady at $1.6565 a gallon while gasoline prices rose 0.76 cent to $1.5077 a gallon.
Nymex natural gas futures declined further from a three-year-low settlement on Monday, falling 17.4 cents to $4.301 per 1,000 cubic feet Tuesday. The contract slid 15.2 cents Monday amid record U.S. supplies to settle at $4.475 per 1,000 cubic feet -- the lowest close since Sept. 26, 2003.
The Organization of Petroleum Exporting Countries recently reduced its demand forecast for the remainder of the year, citing weakening demand in the U.S., among other factors. However, some cartel members have insinuated that oil prices below $60 could prompt a production cut.
Also supporting oil prices were expectations that Wednesday's midweek U.S. petroleum supply snapshot would show domestic crude stocks declined in the week ended Sept. 22.
Crude inventories were expected to fall by 1.92 million barrels, according to a Dow Jones Newswires poll of analysts.
Distillate stockpiles, which include heating oil and jet fuel, were expected to gain 2 million barrels, the poll showed. The Energy Information Administration, the U.S. Energy Department's statistical arm, was to release the data Wednesday.
Oil prices are down 21 percent since hitting a record of $78.40 on July 14.
The summer spike in prices was fueled largely by concerns that Iran, which defied the U.N.'s Aug. 31 deadline to stop enriching uranium, might disrupt oil supplies if sanctions were imposed or if the monthlong conflict between Lebanon and Israel escalated.
Fears of hurricane damage to Gulf of Mexico output also drove the market higher this summer, but the storms so far have not threatened the region. |
