IPE Brent futures deepen losses on US stocks rise, weak demand

London (Platts)--11Nov2005

IPE Brent crude futures fell to the lowest levels in over four months on
Friday, pressured by rising US inventories and unusually warm weather across
the northern hemisphere, traders said.
     Brent futures traded at $54.88/bbl, down 80 cts, at 1040 GMT, a level not
seen since June 15. Brent is trading over $1 below the 200-day moving average
of $56.04/bbl, leaving prices vulnerable to technical selling.
     "The market has been technically driven and we might see some more
technical selling later in the afternoon," one trading source said.
     Oil prices have come under pressure from rising US inventories and as 
mild weather in the northern hemisphere erodes seasonal demand. A US
Department of Energy report Wednesday showed a crude stock build of
4.5-mil/bbl, more than analysts expected. 
     Elsewhere on ICE futures, the front-month December gasoil contract traded
weaker, last changing hands at 1040 GMT at $520.25/mt, down $5.50 from
overnight levels. 
     The December/January spread moved into contango Friday, trading at 
-$11.25/mt, 17.50/mt weaker from Thursday's close. 
     "NW Europe gasoil barges are being sold $18 under the screen, lows not
seen for a long time. NW Europe gasoil cargoes, which are normally traded at a
premium to the screen, have been talked at a discount," a broker said.
--Corneliu Tataru, corneliu_tataru@platts.com


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