Oil prices hit a record $97 a barrel
By Pablo Gorondi, Associated Press Writer
Oil futures jumped to a record $97 a barrel Tuesday after bombings in Afghanistan and an attack on a Yemeni oil pipeline compounded supply concerns that have driven crude prices higher in recent weeks.
Light, sweet crude for December delivery was up$2.80 to $96.78 a barrel on the New York Mercantile Exchange Tuesday after rising as high as $97.
Other energy futures also rose Tuesday. December gasoline futures jumped 6.79 cents to $2.449 a gallon on the Nymex, while December heating oil futures added 6.14 cents to $2.6053 a gallon.
Natural gas for December delivery rose 12.4 cents to $8.126 per 1,000 cubic feet on the Nymex.
In London, Brent crude rose $2.54 to $93.03 a barrel on the ICE Futures exchange. A number of North Sea oil platforms were being evacuated Tuesday in advance of expected severe weather.
Market participants expect the U.S. Energy Department to report Wednesday that oil inventories fell last week, in part because of a suspension of output at Mexico's state oil company Petroleos Mexicanos, a major crude exporter to the United States.
Last week, crude futures jumped more than $4 after figures showed a sharp, unexpected drop in U.S. crude inventories for the second week in a row.
"The oil market is really supported by the tight inventories in the U.S. market and the general expectations for the inventory report this week are that the crude inventories will likely fall," said Victor Shum of Purvin & Gertz in Singapore.
Analysts believe some traders and investors will try to push oil prices to the psychologically important $100-a-barrel level this week. Crude prices are within the range of inflation-adjusted highs set in early 1980. Depending on the how the adjustment is calculated, $38 a barrel then would be worth $96 to $103 or more today.
"While it is on the uptrend, there is a tremendous amount of volatility," Shum said. "It's not unusual to see prices change in a range of $2 in a day."
Crude stocks are expected to fall 1.6 million barrels, according to the average forecast in a Dow Jones Newswires survey of energy analysts. Gasoline inventories are expected to increase by 200,000 barrels, while distillates, which include heating oil and diesel fuel, are likely to have fallen 500,000 barrels, the survey showed.
"With the disruption to Mexican crude oil exports, it's to be expected that U.S. crude imports will remain on the low side in tomorrow's DOE report and keep U.S. crude oil stocks under pressure," said Olivier Jakob at Petromatrix in Switzerland.
The Nymex crude contract had fallen $1.95 to settle at $93.98 a barrel Monday, weighed down by news of more Citigroup write-downs, the release of Turkish soldiers that had been captured by Kurdish militants and a drop in U.S. share prices.
Traders and analysts said the pullback was a result of speculators locking in recent gains, rather than a change in sentiment that could threaten the continuation of crude's 15% runup in the past month.
---------------------------------------------------------------------------------------------------------
This story posted by LeaseTrader.com, the automotive service company that lets people transfer out of their Car Leases early. If you're looking to swap a lease or transfer out of your car lease, please visit www.leasetrader.com.
Print | posted on Tuesday, November 06, 2007 11:59 AM