Market watch: Energy prices weaken

By the OGJ Online Staff

HOUSTON, June 18 -- Energy futures prices generally weakened in trading on the New York Mercantile Exchange Friday.

The July contract for light, sweet crude, the American benchmark, lost 53¢ to settle at $28.51/bbl, while the August contract stood at $28.62, down by 58¢. In after-hours electronic access trading in New York, the July contract was fetching $28.42/bbl, and the August contract $28.61.

Refined petroleum products closed mixed, with July home heating oil losing 2.83¢ to finish at 80.45¢/gal, while unleaded gasoline for the same month advanced by 0.11¢ to rest at 87.29¢.

NYMEX natural gas for July delivery pulled back by 5.9¢ to end at $3.98/Mcf.

Indications of the possibility of a resolution of the United Nations-Iraq conflict in the near future put downward pressure on the market.

Traders said news emanating from diplomatic sources showed that the most recent problems between the two sides were on the way to being resolved, leading to a 6-month extension of the oil-for-food program.

Meanwhile, in London Friday, North Sea Brent crude oil futures were slightly lower at the close of trading on the International Petroleum Exchange, after the expiry of the July futures contract.

Brokers said prices had fallen, but appeared to be stabilizing at just above $28/bbl.

However, they cautioned that if the latest US oil stocks data proved disappointing this week, prices could fall sharply to test support at around $27.50/bbl for the new front-month August futures contract.

IPE August Brent futures settled Friday at $28.12/bbl, down by 20¢ from the previous close. The day's high was $28.57 and the low $27.98.

Also on the IPE, the July contract for natural gas fell 9¢ to close at $2.71/Mcf.

The Organization of Petroleum Exporting Countries' basket of seven crudes stood at $26.59/bbl Friday, compared to $26.56 the previous day. So far this year, the basket has averaged $24.97/bbl. The average last week was $27.08, up slightly from $26.83 in the first week of June. The average May price was $26.25/bbl.