Market watch: OPEC basket price continues to fall amid meeting concerns

The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes continued to fall Thursday, reaching $24.73/bbl, down 2¢ from the previous day. Meanwhile, concerns about a possible US-led attack on Iraq sent oil prices higher in markets in New York and London.

By OGJ editors

HOUSTON, Aug. 9 -- The average price for the Organization of Petroleum Exporting Countries' basket of seven benchmark crudes continued to fall Thursday, reaching $24.73/bbl, down 2¢ from the previous day. Meanwhile, concerns about a possible US-led attack on Iraq sent oil prices higher in markets in New York and London.

"OPEC faces a difficult meeting in Osaka next month," said Tyler Dann, senior integrated oil analyst with Banc of America Securities LLC. "A backdrop of tepid fundamentals, weak quota compliance, quota niggling by OPEC members and market share competition from non-OPEC producers closely resembles that of the late 1997 meeting in Jakarta, where a decision to increase quotas, followed by cheating and demand weakness, proved disastrous for oil prices," he said in a research note released Wednesday.

In New York, energy futures prices rose in trading on the New York Mercantile Exchange. The September contract for benchmark US light, sweet crudes gained 17¢ to $26.67/bbl Thursday and the October contract was up 16¢ to $26.22/bbl. The September natural gas position also gained, closing at $2.75, up 3¢.

Unleaded gasoline improved slightly Thursday from a decline the previous day. The September contract ended up 0.08¢ to 75.54¢/gal on NYMEX. Heating oil for the same month also rose to 67.24¢/gal, up 0.63¢

In London on the International Petroleum Exchange, North Sea Brent crude oil futures prices settled higher Thursday reaching $25.11/bbl, up 16¢ from the previous close. The September natural gas contract continued its decline, falling 0.8¢ to the equivalent of $1.87/Mcf on the IPE.

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