Oil Prices Rise Again After U.S. Stock Drop
August 5, 2000 - 0:0
LONDON Oil prices coasted to two-week highs on Thursday, spurred on by traders fretting over a sharp drop in crude stocks in top consumer the United States.
Benchmark Brent crude for September last traded up 75 cents or 2.7 percent at $28.34 a barrel after hitting a session high of $28.35, Brent's strongest value since July 20.
U.S. light crude Futures were 40 cents stronger at $28.65.
On Wednesday, Brent surged 45 cents and the U.S. benchmark soared 47 cents following bullish U.S. oil stocks reports.
Those gains partly unraveled Saudi Arabia's efforts to cool off prices with additional supply, news of which had helped bring prices down to near three-month lows on Monday.
The American Petroleum Institute's (API) report late on Tuesday shocked the market with news of a nine million barrel drop in U.S. crude stocks in the week to July 28.
On Wednesday, the Energy Information Administration (EIA) fanned the flames with its report showing an even sharper drop of 10.6 million barrels to 284.1 million barrels for the week ended July 28 the largest weekly draw since January 1, 1999.
"This all got started with these stock figures, which were much bigger than expected.
That's what got us up here," said a London trader. "Now we're retaking yesterday's high." Although the market was quick to react to the data, some analysts pinned the falls on lower U.S. crude imports rather than a reflection of tight crude supplies.
OPEC's Saudi Arabia has signalled it is hiking output on its own to try to bring prices down to a targeted $25 a barrel in response to pressure from Washington following record gasoline prices in the large U.S. market.
Industry sources said Saudi Arabia, the dominant power in the Organization of the Petroleum Exporting Countries, planned to move 250,000 bpd more oil in July and another 250,000 bpd in August, although Riyadh has kept silent about its intentions.
Meanwhile OPEC President Ali Rodriguez, also Venezuelan energy and mines minister, said he saw no need for a joint meeting with his Saudi Arabian and Mexican counterparts before the oil cartel's scheduled meeting in September.
The three countries were the architects of a series of oil output curbs in 1998 and 1999 by OPEC and other exporters that hoisted prices from sub-$10 lows to peaks over $30 this year.
Rodriguez, who will accompany Venezuelan President Hugo Chavez next week on a tour of the 10 other OPEC members, told reporters he was in permanent contact with cartel ministers.
(Reuter)
Benchmark Brent crude for September last traded up 75 cents or 2.7 percent at $28.34 a barrel after hitting a session high of $28.35, Brent's strongest value since July 20.
U.S. light crude Futures were 40 cents stronger at $28.65.
On Wednesday, Brent surged 45 cents and the U.S. benchmark soared 47 cents following bullish U.S. oil stocks reports.
Those gains partly unraveled Saudi Arabia's efforts to cool off prices with additional supply, news of which had helped bring prices down to near three-month lows on Monday.
The American Petroleum Institute's (API) report late on Tuesday shocked the market with news of a nine million barrel drop in U.S. crude stocks in the week to July 28.
On Wednesday, the Energy Information Administration (EIA) fanned the flames with its report showing an even sharper drop of 10.6 million barrels to 284.1 million barrels for the week ended July 28 the largest weekly draw since January 1, 1999.
"This all got started with these stock figures, which were much bigger than expected.
That's what got us up here," said a London trader. "Now we're retaking yesterday's high." Although the market was quick to react to the data, some analysts pinned the falls on lower U.S. crude imports rather than a reflection of tight crude supplies.
OPEC's Saudi Arabia has signalled it is hiking output on its own to try to bring prices down to a targeted $25 a barrel in response to pressure from Washington following record gasoline prices in the large U.S. market.
Industry sources said Saudi Arabia, the dominant power in the Organization of the Petroleum Exporting Countries, planned to move 250,000 bpd more oil in July and another 250,000 bpd in August, although Riyadh has kept silent about its intentions.
Meanwhile OPEC President Ali Rodriguez, also Venezuelan energy and mines minister, said he saw no need for a joint meeting with his Saudi Arabian and Mexican counterparts before the oil cartel's scheduled meeting in September.
The three countries were the architects of a series of oil output curbs in 1998 and 1999 by OPEC and other exporters that hoisted prices from sub-$10 lows to peaks over $30 this year.
Rodriguez, who will accompany Venezuelan President Hugo Chavez next week on a tour of the 10 other OPEC members, told reporters he was in permanent contact with cartel ministers.
(Reuter)