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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Justa Werkenstiff who wrote (14550)	6/19/2000 6:15:00 AM
From: Justa Werkenstiff	Read Replies (2) \| Respond to of 15132

Crude Oil Falls as Traders Expect OPEC to Increase Production London, June 19 (Bloomberg) -- Crude oil fell more than 1 percent as traders expect OPEC to agree to increase production this week in an attempt to lower prices that are among the highest of the past nine years. The Organization of Petroleum Exporting Countries, which pumps 40 percent of the world's oil, meets Wednesday in Vienna to consider increasing output, now about 28 million barrels a day. The U.S., the world's biggest energy consumer, has warned high oil prices may hurt economic growth. ``There's a lot of pressure on OPEC to do something,'' said Jurjen Lunshof, an analyst at Credit Lyonnais Securities. ``It's possible they would announce something in excess of 1 million barrels a day.'' Brent crude oil for August settlement fell as much as 40 cents, or 1.4 percent, to $27.95 a barrel on London's International Petroleum Exchange. Crude oil for July delivery on the New York Mercantile Exchange was down 47 cents at $31.86 a barrel in electronic trading. An increase in quotas of 1 million barrels a day -- equal to at least 1.3 percent of world output last month -- would boost actual production by a lower amount, Lunshof said, because members are cheating on their current quotas. In a Bloomberg News survey of 22 brokers, traders and analysts last week, three of the respondents expected either no change or an increase of as much as 500,000 barrels a day; nine expected an increase of 500,000 barrels; nine saw OPEC adding between 500,000 and 1 million barrels, and one expected the group to add more than 1 million barrels to daily output. Agreement OPEC said in March it would boost output by 500,000 barrels a day if its price benchmark surpassed $28 a barrel, yet failed to act when that limit was breached earlier this month. Some members have argued that high U.S. gasoline prices, not a shortage of crude oil, is responsible for a recent price surge, an indication of opposition to boosting quotas at this week's meeting. Any output increase from the meeting is likely to take effect from July 1. The next opportunity to adjust output quotas is likely to be at OPEC's scheduled meeting in September. Oil prices are more than 70 percent higher than a year ago, even after OPEC decided to boost output by 1.7 million barrels a day from April 1. While some OPEC members argue there's no shortage of crude inventories, reports from the U.S. suggest otherwise. The latest report from the Department of Energy showed crude inventories at 299.8 million barrels, more than 10 percent lower than last year. Jun/19/2000 5:28 ET