Oil prices fall despite Nigeria unrest

February 20, 2007 - 0:0
LONDON (AFP) - World oil prices have fallen with warmer weather expected in the United States, and despite fresh unrest in Nigeria, Africa's biggest producer of crude.

In London, the price of Brent North Sea crude for April delivery lost four cents to 58.91 dollars per barrel in electronic trading.

New York's main oil futures contract, light sweet crude for delivery in March, slid 29 cents to 59.10 dollars per barrel.

Calyon analyst Mike Wittner put the falls down to "a little profit-taking" following heavy gains on Friday. "The market has had a lot of support because of the cold weather," said Wittner. "But, that support is going to be coming to an end sooner or later."

Cold temperatures have increased demand for heating fuel, which in turn has lent support to crude futures over the past few weeks.

Oil prices meanwhile dropped Monday even though police said that three Croatians had been kidnapped Sunday in southern Nigeria's oil capital Port Harcourt.

They were the latest of dozens of foreigners kidnapped in the region over recent months. Industry sources said the three Croatians were employed by HydroDive, an offshore engineering company that is a subcontractor for Hyundai Heavy Industries Co. Nigeria.

World oil prices had closed with a gain of more than a dollar on Friday after the U.S. consulate in Nigeria had warned that one militant group there was planning to expand its attacks.

Nigeria is also the world's sixth-biggest exporter of crude oil.

Oil prices also fell on Monday because Iran's oil minister had said on Saturday that OPEC would not need to cut its production of crude further at the cartel's next meeting in March.

"If the oil price remains at current levels, there will probably be no need for a cut," Oil Minister Kazem Vaziri Hamaneh was quoted by the ISNA agency as saying on the sidelines of an oil conference Monday.

His remarks were broadly in line with comments made last week by Ali al-Nuaimi, oil minister of OPEC's number one producer Saudi Arabia.

Al-Nuaimi had told the Wall Street Journal that the cartel might not need to change its oil output quotas at the March 15 meeting in Vienna should market conditions continued.

At its last meeting in December, OPEC decided to cut production by 500,000 barrels per day (bpd) from February 1, following a reduction of 1.2 million bpd in November.

Meanwhile in OPEC member Kuwait, the state's three oil refineries were shut down Sunday owing to a power failure, but exports were not expected to be affected.