Market watch: Energy prices drop in anticipation of OPEC cut
Energy futures fell across the board on New York and international markets Thursday upon signs the Organization of Petroleum Exporting Countries will cut supply at its Mar. 16 meeting in Vienna. Traders reacted primarily to statements from Venezuelan Oil Minister Alvaro Silva during a conference in Mexico City.
By the OGJ Staff
HOUSTON, Mar. 9�Energy futures fell across the board on New York and international markets Thursday upon signs the Organization of Petroleum Exporting Countries will cut supply at its Mar. 16 meeting in Vienna.
Traders reacted primarily to statements from Venezuelan Oil Minister Alvaro Silva during a conference of energy ministers in Mexico City.
"We, OPEC, prefer a price of oil above $25/bbl. Over $25 has not produced problems in the world economy," Silva said. OPEC ministers are considering cuts of up to 1 million b/d in efforts to maintain consistent prices.
Benchmark US light, sweet crude for April delivery declined 61� to $28.39/bbl Thursday on the New York Mercantile Exchange as the May contract ended at $28.62/bbl, down by 54�. In after-hours electronic trading, the two contracts slipped more as April sold for $28.33/bbl and May fetched $28.54./bbl.
Refined products prices also dropped. The April contract for unleaded gasoline settled at 90.36�/gal, down by 1.28�. Home heating oil for April lost 0.84�, settling at 73.30�/gal.
Meanwhile, the April natural gas contract fell 6.5� to $5.29/Mcf.
In London, North Sea Brent crude futures closed lower on the International Petroleum Exchange. Some traders said they anticipated bearish news because the market seemed unjustifiably high.
The April Brent contract closed at $26.68/bbl Thursday, down 55� from the previous close. Thursday's high was $27.25/bbl and the low was $26.55/bbl.
On the IPE, the April natural gas contract settled unchanged at the equivalent of $3.39/Mcf.
The average price for the OPEC basket of seven crudes rose 23� to $25.11/bbl.
