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

To: isopatch who wrote (91414)	6/9/2001 7:12:00 PM
From: Greywolf	Respond to of 95453

Oil market report, Average cash crude oil prices were higher last week ending Thursday, but were losing ground after OPEC Conference on June 5. The Average Dubai crude was at Dlrs 26.45, higher by 63 cents compared to the week before. But the average Brent crude was almost unchanged gaining just one cent to reach Dlrs 28.91. The average price of OPEC Basket advanced 18 cents and was Dlrs 26.65. At the beginning of the week, Iraq's decision to cut oil exports caused a short-term increase of the prices. But the OPEC Conference in Vienna did not increase the Organization's production ceiling and decided to keep it at 24.2 million barrels a day till the next extraordinary meeting in July 3. At the same time, assurances given by the member states, especially Saudi Arabia, that there will be no shortages in the market were seen as bearish news and caused weaker crude prices in the following days. Fundamentally, lower crude prices were a reaction to downward trend in the gasoline prices during last week. This was against traders' former expectations that believed the market would face a shortage in oil product supply. Gasoline prices have lost Dlrs 9.5 a barrel in one month. In Rotterdam for example, gasoline was traded Dlrs 41.93 a barrel in the first week of May but just Dlrs 33.60 a barrel in the first week of June. In New York it fell from Dlrs 41.43 to Dlrs 32.49 during the same period. American Petroleum Institute (API) on Tuesday said that the US gasoline stocks increased by 3.1 million barrels and the oil stocks (including crude and oil products) by 9.1 million barrels. This was seen as a clear indication of sufficient oil supply in the market, a fact that OPEC members expressed several times before the API report. OPEC Secretary General said that an increase of the Organization's production ceiling in the next Conference depends on several factors such as level of stocks and non-OPEC production. He also referred to the lower economic growth expectations in the consuming countries during the third quarter, which will result in a lower crude demand. Iraqi oil exports remains one of the main unpredictable factors in the oil market. Observers believe, however, that the country will resume its oil exports, as it has done by similar situations before. Taking into account that crude demand will increase from 75 million barrels in the second quarter to 77.2 million barrels in the third quarter, and the 500 thousands barrel per day over production of OPEC, consuming countries will need to use 700 thousands barrel per day from oil stocks. Experts say that If OPEC increases its production by 500 thousands barrel per day in July Conference, consuming countries dependence on oil stocks will be around 200 thousands barrel per day, which is the normal level of last years.