By the OGJ Online Staff
HOUSTON, Sept. 28 -- Energy futures prices Thursday regained a little of their previous large losses on the New York Mercantile Exchange but dipped again on the London market.
The decision by members of the Organization of Petroleum Exporting Countries to hold the line on oil production pending another ministerial meeting in November removed one element of uncertainty from the market, said analysts. However, they said, traders still are hard pressed to evaluate the extent of an anticipated global economic recession or the effectiveness of efforts to alleviate it.
The November contract for benchmark US light, sweet crudes regained 36¢ to $22.74/bbl Thursday on the NYMEX, while the December contract was up 32¢ to $23.05/bbl.
Unleaded gasoline for October delivery bumped up 1.37¢ to 63.76¢/gal, and home heating oil for the same month inched up 0.13¢ to 64.92¢/gal. The November natural gas contract was unchanged at $2.25/Mcf.
In London where traders were more cautious, North Sea Brent futures prices drifted lower on the International Petroleum Exchange. The November contract dropped 21¢ to $22.79/bbl Thursday, while the October natural gas contract plunged 18.3¢ to $2.95/Mcf on the IPE.
The average price for OPEC's basket of seven crudes gained 57¢ to $20.68/bbl, marking its fourth consecutive day below the cartel's targeted price range of $22-$28/bbl.
At the opening of an OPEC seminar on global energy Friday in Vienna, Chakib Khelil, Algeria's energy minister and OPEC's conference president, said world demand for oil is projected to grow to 106 million b/d in 2020 from 76 million b/d in 2000, with Asia surpassing North America as the biggest consumer.
"OPEC, with more than three-quarters of the world's proven recoverable crude reserves, will watch its market share grow from around 40% in 2000 to just over 50% in 2020," he said.
But the investment that will be required to supply future demand for oil "will be staggering," Khelil said.
"Moreover," he said, "on top of all this price instability lies the distorting, inequitable phenomenon of excessive taxation on oil products." Khelil reiterated OPEC's long-standing complaint that taxes account for an average 68% of pump prices for petroleum products in Europe while "a meager" 15% is collected by the countries that produce the oil.
"In the US, there have been other factors affecting oil prices, principally a shortage of refinery capacity, stringent product specifications, transport problems such as an inadequate pipeline structure, and just-in-time stock-management policies," he said.
