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

To: cnyndwllr who wrote (87260)	2/15/2001 10:26:40 AM
From: excardog	Read Replies (1) \| Respond to of 95453

1406GMT OPEC Chief Sees No March Output Cut NEW YORK (Dow Jones)--Petroleum futures at the New York Mercantile Exchange are expected to open lower for a fifth straight session Thursday, as traders continue to react negatively to a gloomy supply/demand outlook. There was no market moving news overnight, and analysts said Thursday's expected weakness is a continuation of a pullback that got underway late last week. "What we are getting right now is followthrough selling," said Tom Bentz, an energy analyst at BNP Paribas. "Nothing has changed fundamentally over the past week." However, Bentz said that while the market is searching for direction, sentiment has turned decidedly bearish amid reports of growing supply and weakening demand. Clouding the supply/demand outlook were the International Energy Agency's recent downward revision of its global demand growth forecast and weekly inventory data showing a sharp increase in U.S. crude stocks in the past week, Bentz said. "The market is taking any bearish news very negatively because of a feeling that things are slowing down," he said. To counter the slowdown in the economy and an expected drop in demand for oil in the second quarter, the Organization of Petroleum Exporting Countries last month agreed to cut production by 5%, effective Feb. 1. Analysts say OPEC may have to do more, but cartel officials have been sending mixed signals on what they are going to do at their next meeting in March. Speaking at a Houston energy conference Wednesday, OPEC President Chakib Khelil said he saw no need for the group to cut output any further at its March meeting "It's very difficult to justify another decrease in March," he said. "At this stage, prices are OK." But Venezuelan Oil Minister Alvaro Silva said Thursday that it was too early to discuss any decision on output the group may take at its March meeting. He reiterated Venezuela's hawkish position that Venezuela prefers to see the price of OPEC's basket of crudes in a range of $25.00-$28.00 a barrel. The price of the basket averaaged $25.74 Wednesday. OPEC has previously agreed to keep prices within a range of $22.00-$28.00 a barrel. The price fall suggests to some analysts that the market has moved into a surplus and that the cartel may have to cut output again to prop up prices. "We'd have to say this is in keeping with the fundamentals here as the uptick in U.S. inventories and the lack of worry over the erratic flow of Iraqi crude oil exports is consistent with the idea that the market remains in a supply/demand surplus in spite of the OPEC production cut," IFR Pegasus analyst Tim Evans wrote in a Thursday morning report to clients. Nymex crude oil futures are expected to open 25-30 cents lower, while gasoline futures are seen opening 50-75 points lower and heating oil futures are seen opening 25-50 points down. In overnight trading, March crude ended down 32 cents at $29.39, while March heating oil futures were down 60 points at 76.51 cents a gallon and March gasoline futures were down 90 cents at 87.00 cents a gallon. At 1320 GMT on the International Petroleum Exchange, April Brent was trading 25 cents higher at $27.03 while March gasoil was trading $7.00 lower at $224.25 a ton. -By Masood Farivar, Dow Jones Newswires, 201-938-2094 masood.farivar@dowjones.com