MARKET WATCH: Energy prices fall as Iran hints at conciliation
Crude prices fell July 7 in the New York market after Manouchehr Mottaki, Iran's foreign minister, hinted over the weekend at conciliation with Western powers over that country's nuclear program.
HOUSTON, July 8 -- For the first time in four trading sessions, crude prices fell July 7 in the New York market after Manouchehr Mottaki, Iran's foreign minister, hinted over the weekend at conciliation with Western powers over that country's nuclear program.
In television interviews Mottaki also indicated Iran would make no unprovoked attack on Israel.
Analysts in the Houston office of Raymond James & Associates Inc., however, reported, "Crude decreased by nearly 3% on concerns that the European economy may be slowing." Crude prices continued to decline in premarket trading July 8, "despite the Iranian president insisting that his country will continue with its nuclear program and not succumb to international demands to end uranium enrichment," they said.
Raymond James analysts also noted: "Natural gas is down premarket after decreasing slightly over 4% yesterday on forecasts that Hurricane Bertha, the Atlantic hurricane season's first storm, will avoid the gas-producing fields in the Gulf of Mexico." Tropical storm Bertha strengthened overnight into a hurricane.
Olivier Jakob at Petromatrix, Zug, Switzerland, said, "Bertha is gaining strength over the Atlantic with potential to become a [Level 3 hurricane], but most computers models are still showing it to track northward towards the mid-Atlantic."
The August contract for benchmark US light, sweet crudes dropped $3.92 to $141.37/bbl July 7 on the on the New York Mercantile Exchange. The September contract lost $3.83 to $142.03/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., was down $3.90 to $141.38/bbl. Heating oil for August delivery lost 13.6¢ to $3.97/gal on NYMEX. The August contract for reformulated blend stock for oxygenate blending (RBOB) declined 8.83¢ to $3.48/gal.
The August natural gas contract fell 60¢ to $12.98/MMbtu on NYMEX. On the US spot market, gas at Henry Hub, La., dropped 17¢ to $12.88/MMbtu.
In London, the August IPE contract for North Sea Brent was down $2.55 to $141.87/bbl. The July contract for gas oil fell $27.25 to $1,270.75/tonne.
The average price for the Organization of Petroleum Exporting Countries' basket of 13 benchmark crudes dropped to $138.44/bbl on July 7, down from a revised price of $140.13/bbl on July 4.
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