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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: JHR who wrote (46707)	6/21/1999 11:46:00 AM
From: pz	Read Replies (1) \| Respond to of 95453

Oil -.32....likely reason

To: JHR who wrote (46707)	6/21/1999 11:50:00 AM
From: pz	Respond to of 95453

Monday June 21, 8:38 am Eastern Time Note: this article has a followup with more information. FOCUS-Oil eases as Nigeria fails to stir concern LONDON, June 21 (Reuters) - Oil markets weakened on Monday as Nigerian supply worries failed to distract trader attention from ample global stocks and cuts in refinery operating runs. International marker crude Brent blend was trading 15 cents lower at $16.35 a barrel at 1150 GMT. ''There's plenty of crude. Just look at the run cuts,'' said one dealer on London's International Petroleum Exchange. Global refinery profit margins are improving slightly from damage inflicted by a recent crude price rally, but the gains have yet to persuade operators to expand operating volumes. The market took in its stride word that Texaco had suspended crude loadings at Nigeria's Pennington Terminal after community protests forced shut six offshore platforms producing 50,000 barrels per day (bpd). Texaco shut the platforms on Friday after youths boarded two of the installations from boats to demand compensation money for a small oil spill in June 1998. Texaco has a 20 percent stake in the joint venture which it operates for Nigerian National Petroleum Corporation, holding a 60 percent stake, and Chevron Corp, which has the remaining 20 percent. Normal operations resumed on Friday at Royal Dutch/Shell's Nigerian unit following a five-day strike by workers seeking better pay and conditions. Dealers were similarly unimpressed by a monthly OPEC report reporting crude output fell 371,000 bpd to 25.852 million barrels per day in May from 26.223 million in April as part of a price rescue package. The Organisation of the Petroleum Exporting Countries said an average of media and industry consultancy estimates put Saudi Arabia's May output down 128,000 bpd at 7.37 million, or below its official 7.438 million allocation. The market's price structure suggests that while prices should firm in the medium term as OPEC cuts bite into supply, there is no shortage of oil for prompt delivery, London's Centre for Global Energy Studies said. ''The market seems to be anticipating tighter market fundamentals than have yet to show up,'' the centre said in a market commentary. There was little justification for prices $4 a barrel higher than a year ago because forward stock cover in developed countries in the second quarter of this year was unchanged from the second quarter of 1998, it said. ''The fundamentals continue to be at odds with upwardly mobile price expectations that are encouraging speculators to maintain large net long open positions,'' it said, referring to transactions that bet prices will rise.