Open

Coming up

Don't miss

Replay


LATEST SHOWS

THE WORLD THIS WEEK

The World This Week - July 25th, 2014 (part 2)

Read more

REPORTERS

Halal tourism on the rise

Read more

THE WORLD THIS WEEK

The World This Week - July 25th, 2014

Read more

#THE 51%

Sweden: A Feminist's Paradise?

Read more

AFRICA NEWS

Search of Air Algerie crash site continues

Read more

WEB NEWS

NSA targets 'Tor' network users

Read more

WEB NEWS

Web users call for peace in Gaza

Read more

BUSINESS DAILY

French government hopes to collect €1.8bn from foreign accounts

Read more

DEBATE

Gaza: A Truce At All Costs?

Read more

  • Video: Slaviansk mourns mass grave victims

    Read more

  • Video: Ethiopia turns to wine to boost image, economy

    Read more

  • France honours those lost on Air Algérie Flight AH5017

    Read more

  • The centenary of Austria-Hungary’s calamitous last hurrah

    Read more

  • UN Security Council calls for immediate Gaza ceasefire

    Read more

  • Nibali joins elite group with Tour de France win

    Read more

  • France calls on its nationals to leave Libya as violence escalates

    Read more

  • Boko Haram kidnap Cameroon minister's wife in deadly attack

    Read more

  • Muslims prepare for Eid al-Fitr festival

    Read more

  • ‘Irresponsible’ American dad tries to scale Mont Blanc with children

    Read more

  • Ukraine fighting prevents observers from accessing MH17 crash site

    Read more

  • In pictures: Crowds flock to enjoy the Tour de France show

    Read more

  • Netanyahu says Hamas 'violating its own ceasefire'

    Read more

  • Video: At the scene of the Air Algérie crash in Mali

    Read more

  • Costa Concordia arrives in port of Genoa to be scrapped

    Read more

  • In pictures: Youths clash with police at banned Gaza protest

    Read more

  • Russia lashes out at new EU sanctions over Ukraine

    Read more

  • Bodies of all Air Algérie crash victims to be brought to France

    Read more

  • Syrian army and ISIS both claim advances

    Read more

  • Briton kidnapped in Yemen freed after five months

    Read more

  • New round of Gaza ceasefire talks takes place in Paris

    Read more

Sliding oil prices have $100 mark in sight

Latest update : 2008-09-03

The price of crude dropped to as low as $105.46 a barrel in US trade due to the weakening Hurricane Gustav. Washington's decision to release oil from its strategic reserves put further downward pressure on prices as Asian markets opened.

Read the commentary by our Business Editor Douglas Herbert.

 

Oil prices fell in Asian trade Wednesday as the US government announced the release of oil from its strategic reserve to help with recovery efforts after Hurricane Gustav.

In afternoon trade New York's main contract, light sweet crude for October delivery, dropped 71 cents to 109.00 dollars a barrel, while Brent North Sea crude for October delivery eased 74 cents to 107.60.

The United States announced Tuesday it was releasing 250,000 barrels from its emergency supplies, known as the strategic reserve.

"The release of the oil will prevent any shortage and that will, of course, help calm the market," said Victor Shum, a Singapore-based analyst with energy consultancy Purvin and Gertz.

The US Strategic Petroleum Reserve is a complex of underground storage caverns that hold emergency supplies of crude oil. According to the US Department of Energy, the inventory exceeded 700 million barrels on April 2.

There was no oil production Tuesday in the hurricane-affected region, where a quarter of US oil is normally produced, the US Department of the Interior said. Ninety-five percent of natural gas production was offline.

The threat from Gustav raised grim memories of the 2005 hurricanes Katrina and Rita that damaged or destroyed about 165 of around 4,000 oil platforms in the Gulf.

But damage this time appeared to be less severe.

Crude prices have eased about 25 percent since reaching record levels above 147 dollars in July, pulled down by worries about slowing global growth affecting energy demand.

"As the reality of this storm is now becoming clear, energy bulls are on the run and the market is finally facing up to the realities surrounding it," said Phil Flynn, an analyst at Alaron Trading.

As oil prices fell, Iran called for the Organisation of the Petroleum Exporting Countries (OPEC), which produces 40 percent of world output, to discuss excess supply at its meeting in Vienna on September 9.

"Some OPEC members are providing the market with excess supply and producing more than their OPEC quota. Therefore, at the next meeting the members will request a stop to the excess supply," Oil Minister Gholam Hossein Nozari said.

He said 100 dollars a barrel was a minimum for oil prices. Iran is the world's fourth-largest crude producer.

Date created : 2008-09-03

COMMENT(S)