By OGJ editors
HOUSTON, Nov. 3 -- Energy prices continued to fall Tuesday, with the near-month crude contract dropping below $50/bbl on the New York Mercantile Exchange for the first time in 4 weeks.
Analysts generally cited weakening economies around the globe and growing confidence of adequate energy supplies through the winter. However, there also was speculation that the possibility of a win by John Kerry in the US presidential election Tuesday contributed to the sell-off.
Crude futures prices were reported on the rise early Wednesday as it became evident that President George W. Bush would win reelection. During his first term, Bush aggressively pursued a policy to try to fill the Strategic Petroleum Reserve to its maximum 700 million bbl capacity. Workers added 40 million bbl to that reserve this year, raising it to its highest level ever of 670 million bbl.
Meanwhile, in Nigeria a tribal leader threatened Wednesday to "attack and kidnap" any oil workers who cross picket lines in a general strike scheduled for Nov. 16.
Energy prices
The December contract for benchmark US light, sweet crudes lost 51¢ to $49.62/bbl Tuesday on NYMEX, while the January contract was down by 42¢ to $49.59/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., retreated by 51¢ to $49.63/bbl. Heating oil for December delivery declined by 1.54¢ to $1.39/gal Tuesday on NYMEX. Gasoline for the same month slipped by 0.31¢ to $1.2877/gal.
The December natural gas contract plunged by 15.3¢ to $8.57/Mcf, "weighed down by falling crude oil prices and fairly mild weather this week that weakened the [spot] cash market," said analysts Wednesday at Enerfax Daily.
In London, the December contract for North Sea Brent crude lost 51¢ to $46.55/bbl Tuesday on the International Petroleum Exchange.
The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes dropped by $1.33 to $41.98/bbl Tuesday.
