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

To: Jamey who wrote (27521)	8/11/1998 1:13:00 PM
From: Snowshoe	Read Replies (2) \| Respond to of 95453

FOCUS-Oil prices plunge to fresh 10-yr low By William Maclean Tuesday August 11, 6:23 am Eastern Time LONDON, Aug 11 (Reuters) - Oil prices hit a fresh 10-year-low on Tuesday following a savaging triggered by the spectre of a prolonged glut. Brent crude was trading four cents firmer at $11.95 a barrel at 1010 GMT after sliding to a new low of $11.87, below the previous 10-year floor of $11.90 set in March. Brent had slid a sharp 68 cents on Monday to settle at $11.91 under pressure from a mountainous glut of crude and products. Brokers said there was no overnight news to propel prices either way but a crippling oversupply would continue to dominate the trading landscape. "Anything could happen," one broker said. The lifeblood of industrial economies has not been this cheap in real terms for 25 years. North Sea Brent is now about 40 percent cheaper than last year's average $19.32. The fall has slashed earnings of member states of the Organisation of the Petroleum Exporting Countries (OPEC), raising fears for economic growth and the political stability of the oil-dependent producers. London brokers GNI said that neither renewed confrontation between the United Nations and Iraq nor bombings of U.S. embassies in East Africa were likely to support the market. ''The reality is that neither of these two issues is likely to seriously interrupt the world supply of oil in the near term,'' the GNI Energy Report said. GNI and other analysts say relief for prices could come only from strict compliance with OPEC output cuts and a particularly cold northern hemisphere winter which would hike demand for heating oil. Brent crashed on Monday under the impact of rapid losses on U.S. oil product contracts on the New York Mercantile Exchange triggered by brimming stock levels in the world's biggest energy market. Brent last touched a low of $11.90 in March, which prompted producers to make the first of two sets of output cuts aimed at propping up prices. Compliance by OPEC with its mandated 2.6 million barrels per day (bpd) of cuts has been patchy, however, with less than two-thirds adherence assessed by a Reuters survey in July. Oil prices had hovered around the $13 level in recent weeks with the market weighed down by massive oversupply resulting from rising output and a downturn in demand in crisis-hit Asia. But many experts do not expect any major improvement in prices until the last quarter of the year. Further pressure on the oil complex comes from traders' expectations that a stand-off between the United Nations and Iraq will be settled by diplomacy rather than force of arms. They also predict that any crisis would not lead to a halt in the U.N.-monitored oil-for-food programme under which Iraq exports around 1.6 million bpd to pay for food and medicine. Prices in dollars per barrel: Aug 11 Aug 10 (1003 GMT) (close) IPE September Brent 11.90 11.91 NYMEX September light crude 12.98 13.05