Crude prices declined in mixed trading on three international markets Wednesday in apparent corrections of recently "overheated" trading.
The June contract for benchmark US sweet light crudes dropped 41� to $29.32/bbl on the New York Mercantile Exchange (NYMEX), while the July contracts lost 21� to $29.44/bbl. However, those contracts inched back up in after-hours electronic trading to $29.42/bbl on the June contract and $29.48/bbl for July.
In London, North Sea Brent closed at $27.89/bbl, down 21� for the day, after trading in ranges of $27.62-28.12 on the International Petroleum Exchange. Brokers predicted Brent prices will soon stabilize above $27/bbl.
On the Singapore Exchange, the July contract for North Sea Brent settled at $27.92/bbl, down 28� from the June contract that expired Tuesday.
That decline resulted from the combination of a widely expected technical adjustment and reports of slow growth in Thailand's economy, which is dampening demand for oil, traders said. A correction was "inevitable" since even strong market fundamentals do not justify oil prices in the range of $29/bbl, they said.
OPEC's average basket price for 7 crudes dipped 25� to $27.92/bbl Wednesday. The OPEC Secretariat also reported that basket price fell $3.78 to an average $22.93/bbl in April from March levels.
OPEC officials estimated world demand for crude at 76.1 million b/d, down by 40,000 b/d from their previous estimate. They said OPEC supply is down slightly to 27.4 million b/d, while non-OPEC supply is up 70,000 b/d to a total 45.8 million b/d.
Meanwhile, the June contract for natural gas jumped 24.1� to $3.69/Mcf on the Nymex.
That helped boost the June contract for home heating oil by 0.52� to 77.36�/bbl. Heating oil is always affected by big moves in gas prices since utilities rely on it as an alternative fuel, traders said.
The June contract for unleaded gas dipped 0.33� to 97.98�.
