By OGJ editors
HOUSTON, May 26 -- Energy futures prices declined on the New York Mercantile Exchange Tuesday upon traders' expectations that Saudi Arabia and other members of the Organization of Petroleum Exporting Countries will increase oil production.
Meanwhile, the European Union's group on the security of oil supply met Wednesday in Brussels to assess strategic oil stocks.
European Commission Vice-Pres. Loyola de Palacio called for more international cooperation and increased flexibility regarding oil supplies. Oil price stability hinges upon cooperation between oil-producing nations and oil-consuming nations, she said.
"Oil price movements for the last months have provided a new wake-up call. It is not possible to separate domestic policies from their international implications, and we must intensify cooperation between consumers and producers," she said.
The July contract for benchmark US light, sweet crudes slipped 58¢ to $41.14/bbl Tuesday on the New York Mercantile Exchange. The August contract lost 56¢ to $40.68/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., dropped 75¢ to $41.13/bbl.
Gasoline for June delivery plummeted 4.13¢ to $1.4165/gal Tuesday on NYMEX, while heating oil for the same month lost 2.13¢ to $1.0273/gal.
The June natural gas contract lost .021¢ to $6.684/Mcf. Enerfax Daily analysts said natural gas futures were "pressured by a sharp slide in crude oil and some technical selling when an early attempt to move up stalled despite a strong cash market."
The June NYMEX contract expires Wednesday, they added. NYMEX will be closed Friday afternoon and Monday for the Memorial Day holiday.
In London, the July contract for North Sea Brent crude also dropped on the International Petroleum Exchange. On Tuesday, IPE July Brent lost 73¢ to $37.44/bbl.
Gas oil for June delivery declined by $8.75 to $323.22/tonne, while the June natural gas contract held steady at the equivalent of $3.90/Mcf on IPE.
The average price for OPEC's basket of seven benchmark crudes gained 31¢ to $37.36/bbl Tuesday.