MARKET WATCHEnergy prices resume previous decline

Nov. 9, 2004
Energy futures prices resumed their decline Monday as speculators continued to pull out of that market despite increased allied action against insurgents in Fallujah, Iraq, and a pending strike that could shut in oil production in Nigeria.

Sam Fletcher
Senior Writer

HOUSTON, Nov. 9 -- Energy futures prices resumed their decline Monday as speculators continued to pull out of that market despite increased allied action against insurgents in Fallujah, Iraq, and a pending strike that could shut in oil production in Nigeria.

The Nigeria Labor Congress has threatened to call a general strike Nov. 16 that is expected to close down Nigerian oil exports of 2.5 million b/d unless the government rolls back recent increases in domestic fuel prices (OGJ Online, Nov. 5, 2004). However, Nigeria's labor minister warned Monday that workers participating in that strike may lose their jobs.

The December contract for benchmark US light, sweet crudes lost 52¢ to $49.09/bbl Monday on the New York Mercantile Exchange, while the January position retreated by 45¢ to $49.17/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down by 53¢ to $49.09/bbl. Gasoline for December delivery declined by 1.15¢ to $1.28/gal Monday on NYMEX. Heating oil for the same month dipped by 0.77¢ to $1.3664/gal. The December natural gas contract fell by 35.4¢ to $7.60/Mcf, "with record [US gas] storage inventories and a steeply discounted [spot natural gas] cash market," despite cooler weather forecasts for this week that should boost demand, said analysts Tuesday at Enerfax Daily.

In London, the December contract for North Sea Brent crude lost 50¢ to $45.92/bbl on the International Petroleum Exchange.

However, the average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes gained 11¢ to $38.67/bbl Monday.

Contact Sam Fletcher at [email protected]