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To: Bobby Yellin who wrote (18524)	9/11/1998 4:20:00 PM
From: Alan Whirlwind	Respond to of 116898

Dead gato bounce Bobby. Coffee futures took a huge tumble today in anticipation of devaluation of Brazil's currency. Sugar hit a ten year low on similar fears. The worst, if it can be believed, is yet to come. --Al

To: Bobby Yellin who wrote (18524)	9/11/1998 4:32:00 PM
From: goldsnow	Respond to of 116898

Gold next? FOCUS-Speculators abandon oil amid economic crisis 06:54 a.m. Sep 11, 1998 Eastern By Richard Mably LONDON, Sept 11 (Reuters) - World petroleum markets are suffering the impact of the spreading international financial crisis which has dampened speculative demand for oil, the International Energy Agency (IEA) said on Friday. ''More than in the past, oil markets are being buffeted by external economic factors,'' the agency said in its monthly Oil Market Report. ''Evidence that Asian financial difficulties are spreading to Russia and Latin America has shaken investor confidence and dampened speculative appetite for commodities like oil.'' The IEA said that recent data indicated a slowdown in demand patterns for oil in China and the former Soviet territories, following an unprecedented decline in Asian consumption. ''Slower Chinese apparent oil demand growth is consistent with indications of a cooling economy, which is being mirrored in a marked deceleration in the demand for electricity,'' the IEA report said. Russia's own problems have cut domestic consumption and left more oil for export, keeping sales at record post-Soviet highs in August despite some delays because of gridlock in the Russian banking system. The result is a weaker outlook for world oil demand in the fourth quarter of the year. ''Prospects for global demand in the second half of 1998 have weakened this month,'' said the agency. It sliced its projection for the fourth quarter by 400,000 barrels a day. World demand this year is now seen growing only 700,000 barrels per day (bpd) from 1997 to 74.5 million bpd. Demand growth is still expected to recover to an annual 1.6 million bpd in 1999 reaching 76.1 million. Despite the weak pulse of demand, the IEA said it saw improved prospects for clearing the excess inventories which have plagued the market this year. It said stock levels which forced oil prices to a 10-year low in August probably did not grow by quite as much as feared later in the summer. Oil was valued at $13.50 on Friday, $2 a barrel higher than the lows of early August but still nearly $6 short of last year's average price. Third quarter growth in world oil stocks was likely to show a ''relatively small'' inventory build of 500,000 bpd. Surplus year-on-year stocks at the end of July were estimated at 197 million barrels versus a peak of 209 million barrels at the end of June, the agency added. While the overall inventory picture might have improved northern hemisphere consumers certainly are not likely to run short of heating oil this winter. The IEA said Asian refiners had led the way in cutting operations to contain the production of distillates or heating oil and diesel. ''Distillate inventories rose to capacity levels in a number of refining centres,'' said the report. ''Lack of storage space is forcing the use of gasoline tanks to store heating oil. Meanwhile, world oil production is falling, thanks to supply sacrifices by the Organisation of the Petroleum Exporting Countries and summer maintenance in the North Sea. World oil output in August was estimated down 1.2 million barrels a day at 73.86 million bpd, including a 390,000 bpd reduction from OPEC taking it to 27.26 million. The producer group in August was 83 percent in compliance with its self-imposed target for 2.6 million bpd of output cuts, the IEA said. Lower OPEC output averaging 26.6 million in the fourth quarter could see demand exceeding supply by as much as 1.8 million bpd, offsetting most of the excess stocks seen in mid-year. Copyright 1998 Reuters Limited.