Business
Oil prices decline to US $ 57.5

July 21 (AFP) - World oil prices lost ground on Thursday on relief that a hurricane in the Gulf of Mexico had had a limited effect on crude stockpiles in the United States, dealers said.

New York’s main contract, light sweet crude for delivery in September, shed 50 cents to 57.52 dollars per barrel in electronic deals. The August contract had expired on Wednesday, closing at 56.72 dollars per barrel.

In London on Thursday, the price of Brent North Sea crude oil for delivery in September fell 43 cents to 56.22 dollars per barrel.

Data from the US government’s Department of Energy (DoE) revealed on Wednesday a smaller-than-expected drop in US crude inventories — despite concern that Hurricane Dennis would affect Gulf of Mexico oil production.

"People’s expectations were far away from the reality," according to Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures in Tokyo.

News of a smaller decline in crude reserves caused prices to pull back, he said, adding: "When their fears did not happen they had to sell off the market".

The DoE said US crude oil stocks fell 900,000 barrels to 320.1 million barrels for the week ending July 15.

Analysts’ forecasts were for a 3.45-million drop in the wake of production shutdowns in the Gulf caused by Hurricane Dennis — whose onset halted most US oil output in the region around July 10.

The DoE also said petrol or gasoline stocks dropped by 1.3 million barrels, less than forecasts of a 1.5-million decrease.

But levels of distillate products, used for heating oil and diesel, rose by a greater-than-expected 2.3 million barrels for the week, the DoE said. That beat expectations of a 1.7-million build.

 

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