Oil prices fall before US inventory data

6th October 2010, Comments 0 comments

Oil prices dropped slightly on Wednesday as traders awaited the latest weekly snapshot of energy inventories in the United States, the world's biggest consumer of energy.

New York's main contract, light sweet crude for delivery in November fell six cents to 82.76 dollars a barrel.

Brent North Sea crude for November shed 11 cents to 84.73 dollars.

The US government's Department of Energy will publish its latest inventory data at 1430 GMT.

On Tuesday, data released by the private American Petroleum Institute (API) showed a spike in US crude reserves.

Victor Shum, an analyst at energy consultants Purvin and Gertz, said the data was helping to push prices lower.

"The API report indicated crude stockpiles climbing by 4.4 million barrels in the last week. That's a huge gain," he said.

He added however that prices would continue to be supported by a disruption of supply in the US Gulf Coast and a rolling strike in a key French oil terminal.

The closure of a shipping channel in the US city of Houston after a barge accident on Sunday caused a crude shortage in four refineries around the area as supplies were disrupted, according to US media reports.

A major oil terminal in France has been hit by ongoing strikes, triggered by union opposition to government plans to reform the country's ports.

The general secretary of the port's CGT union, Pascal Galeote, told Dow Jones Newswires the strike at Fos-Lavera oil terminal would continue into its 10th day on Wednesday.

Despite Wednesday's losses, Ian Parrett, an analyst at UK energy consultancy Inenco, forecast that prices would move further towards 100 dollars per barrel, possibly by the end of the year, on the back of a global economic recovery.

"There is continued hope that Asian economies will lead the global recovery," he said.

© 2010 AFP

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