Market Watch: July 3

Oil futures prices dipped Friday on the New York Mercantile Exchange as traders, reluctant to hold positions over a 4-day holiday weekend, engaged in profit-taking following a strong market performance Thursday.

Jul 3rd, 2000


Oil futures prices dipped Friday on the New York Mercantile Exchange as traders, reluctant to hold positions over a 4-day holiday weekend, engaged in profit-taking following a strong market performance Thursday.

A report that Saudi Arabian officials still consider current oil prices to be too high also had a bearish effect.

The August contract for the benchmark blend of light, sweet crudes lost 22�, closing at $32.50/bbl on the NYMEX. The September contract was down 12� to $31.13/bbl.

Refined petroleum products also closed lower, with the July contract for unleaded gasoline down 1.27� to $1.0378/gal. Home heating oil closed at 84.14�/gal, down 0.33�.

However, the August contract for natural gas jumped 5.3� to $4.48/Mcf.

The NYMEX is closed Monday and Tuesday for Independence Day.

In London, futures contracts for North Sea Brent also dipped on the International Petroleum Exchange, but remained comfortably above $30/bbl with strong technical and fundamental indicators. That contract closed at $30.57/bbl Friday, down 23�.

London brokers expect oil prices to hover around $30/bbl until the next ministerial meeting of the Organization of Petroleum Exporting Countries in September.

They report a growing expectation that OPEC will boost production more substantially then.

On the IPE, the August natural gas contract was off sharply, declining the equivalent of 16� to $2.62.

The price of North Sea Brent crude oil ended on a slightly softer note on the Singapore exchange today, taking its cue from the falls seen in New York and London Friday.

Traders pointed out that prices were still on the firm side with the forward August contract maintaining a good price of $30.57/bbl, with the September position following up with $29.39.

The average price of OPEC's basket of seven crudes gained 3� to $30.13/bbl Friday. That basket price averaged $29.78/bbl last week, up 89� from the previous week's average.

During the first half of this year, the OPEC basket price has averaged $26.24/bbl. That amounted to an average $26.37/bbl during the second quarter, including an average $29.11/bbl in June, $26.24/bbl in May, and $22.93/bbl in April. That's up sharply from 1999's total average of $17.47/bbl and $12.28/bbl in 1998.

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