Oil prices fall, stay above 71 dollars

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Oil prices fell on Tuesday but managed to hold above 71 dollars -- a price deemed "acceptable" by crude exporter Kuwait.

New York's main futures contract, light sweet crude for delivery in July, dropped 15 cents to 71.29 dollars a barrel. In midday London trade, Brent North Sea crude for July was down 48 cents to 71.64 dollars.

The current oil price is "acceptable" and there is no need for OPEC to hold an extraordinary conference to discuss cutting output in a bid to boost prices, Kuwait's Oil Minister Sheikh Ahmad Abdullah al-Sabah said on Tuesday.

"The price (of oil) is acceptable," said Sheikh Ahmad when asked about the current crude prices, adding he expects the price to continue to fluctuate but to remain within the current range until the end of the year.

The Kuwaiti minister also said he favours an oil price at between "75 and 85" dollars a barrel but stressed there was no need for an extraordinary meeting of the Organization of Petroleum Exporting Countries (OPEC) at this stage.

Oil prices had ended mixed on Monday in volatile trading amid market concerns that weak employment will dampen economic recovery in the United States, the world's biggest energy consumer.

The market remains concerned over the mounting European debt crisis as well as a weaker-than-expected report on job creation in the United States that underscored reluctance by US employers to hire new workers.

"The recovery of global fuel demand becomes more and more questionable in the wake of rising concern over the sovereign debt crisis in Europe and disappointment over the Labor Department's jobs report on Friday," said Mike Fitzpatrick, vice-president of MF Global.

The report showed that private-sector jobs rose in May by just 41,000 or less than a fifth of the amount predicted by analysts.


© 2010 AFP

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