Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Think4Yourself who wrote (48023)	7/15/1999 9:44:00 AM
From: Tomas	Respond to of 95453

Oil price rise leads to uncertainty - Financial Times, Thursday By Paul Solman Oil prices risk becoming the victims of their own success, analysts warn. As crude prices in both London and New York surge to their highest for 20 months, some analysts suggest recent output cuts could leave the world market short of crude when demand picks up for winter in the northern hemisphere. Others say the next meeting of the Organisation of Petroleum Exporting Countries, scheduled for September 22, could decide to ease the voluntary production limits imposed to support prices. If that happens, oil prices could head back towards the 12-year lows at the end of last year. August Brent blend rose to $19.43 a barrel on London's International Petroleum Exchange yesterday, its highest since late 1997, as a new set of figures from the American Petroleum Institute showed another drawdown in US stocks. Opec-agreed production cuts - which are enjoying about 93 per cent compliance - have helped Brent almost double since the start of the year, and the price has added $3 in the past three weeks alone. Light crude has also jumped on the New York Mercantile Exchange and now stands at around $20 against $12.20 at the beginning of the year. "Everybody is quite happy to see oil prices at this level, but if they go much higher before the Opec meeting, we could see a change in policy," said one analyst yesterday. Another added: "If prices go to $23 a barrel, for instance, Opec might decide to produce another 1m-1.5m barrels a day. That will push prices right down, especially if the northern hemisphere has a mild winter." In the short-term, analysts remain bullish, suggesting inventory levels could soon approach 1996 levels, when Brent hit $25 a barrel. But they warn that the fast rise in prices leaves the market vulnerable. "Opec compliance is phenomenal, and demand is looking robust. But when the price spikes like this, you can never be sure how the market will react," one analyst said. Brent was $18.96 a barrel in late trading last night, a loss of 7 cents on the day, while Nymex light crude was off 30 cents at $19.85.