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

To: P.Prazeres who wrote (21654)	5/7/1998 5:32:00 PM
From: pz	Respond to of 95453

NEW YORK, May 7 (Reuters) - NYMEX crude oil and refined product futures fell Thursday, giving up the day's gains toward the close as sporadic sell-offs turned trading choppy, after a bout of short-covering lifted the market earlier. NYMEX June crude closed at $15.24 a barrel, down 13 cents and just a notch above the day's low of $15.20. The front-month contract traded as high as $15.68 on the day before retreating late in the session. June heating oil ended at 43.58 cents a gallon, down 0.24 cent while gasoline lost 0.34 cent at 52.19 cents a gallon. "Crude slipped, but still within trading range," said a NYMEX floor trader. "The market seems to be comfortable trading this way, going up or down 50 cents," another trader said, adding the market is still reassessing various signals from big producers on what their intentions are. "There is still a lot of support," the trader said, noting that the market has consistently come back up in recent sessions once it neared the $15-a-barrel level. But he said he would not be surprised if the market weakens further ahead of the weekend on Friday and retrace the $14.95-$15.06 area. Expiration of crude options on Friday partly spurred the market's bounce just before midday, traders said. Crude was trading just above $15.37 in late afternoon when sell-offs wiped out the day's gains. In London, IPE Brent crude oil futures ran out of steam in a pre-closure sell-off, erasing gains in the day's earlier rally. June Brent last traded at $14.46 a barrel, off three cents. Hopes that the oil ministers of Saudi Arabia, Venezuela and Mexico would meet soon "are fading," a Texas-based analyst said. And conflicting signals from them "are not that easy to interpret," he added. He cited Venezuela's Oil Minister, Erwin Arrieta, who said Wednesday that it was necessary to wait two months before evaluating the effects of the Riyadh Pact on oil prices. "We need 60 days to evaluate the effects of the measures taken before taking any decision on further measures," he told reporters at an industry conference in Valencia, 150 kms west of Caracas Wednesday. Just over a week ago, Arrieta said the market needs another cut of 500,000 barrels per day (bpd) to lift prices and further cuts could come before OPEC's June meeting in Vienna. He also said he had talked with his Saudi and Mexican counterparts. Arrieta and the oil ministers of Saudi Arabia and Mexico negotiated the Riyadh agreement in March, leading to the pledge by OPEC and some non-OPEC producers to cut oil production by 1.5 million bpd effective April 1. From Mexico, meanwhile, Energy Minister Luis Tellez continued to maintain that he does not see any meeting of the "Riyadh Pact" group in the immediate future. Given the current market conditions and outlook, he said Mexico will not cut its output further. He said, however, that Saudi Arabia, Venezuela, Mexico and Norway, the last two being non-OPEC members, have complied with their pledges under the March agreement. A Reuter survey released on Wednesday that OPEC producers, which had pledged to cut 1.245 million bpd under the Riyadh accord, had complied partly, with 10 members cutting their April output by about 900,000 bpd. Iraq, an OPEC member whose exports are monitored by the United Nations, is not a participant. Iraq's output has risen by 300,000 tons since February, complicating the glut situation. Under a U.N.-Iraq "oil-for-food" deal, the country has been allowed to raise its oil exports for six months to $5.2 billion from $2 billion previously. Implementation of the higher export target hinges on the U.N.'s approval of a distribution plan of the proceeds, which are aimed at helping needy Iraqi citizens. According to the U.N. in Baghdad, the distribution plan for the enhanced program should be ready in the next few days.