Supply concerns keep crude prices high

Supply concerns keep crude prices high

Singapore (Platts)--13Oct2004


Crude prices remained elevated in Asian electronic trading by global supply
concerns fueled by strikes and US Gulf shut-ins despite a limited and
short-lived technical reversal Tuesday, traders said. "We are still in a
healthy, sustainable bull run," a risk manager in Asia said. 

Supply concerns
continued on strikes in Nigeria and Norway and on expectations of a tight
heating oil market ahead of the northern hemisphere's peak winter demand
season. A four-day warning strike over fuel price hikes in OPEC member Nigeria
that began Monday threatened to escalate as well as continue beyond Thursday.
Oil unions are maintaining a skeletal staff at the production locations but
loadings from the country's main export terminals have not been affected.
Shell also said it had reduced its output by about 20,000 b/d following a
blast at leaking pipeline that carried crude from wells in southern Nigeria to
its Bonny oil terminal. Shell pumps around 1-mil b/d of Nigeria's 2.4-mil b/d.

US benchmark crude West Texas Intermediate for November delivery was trading
around 52.60/bbl at 0805 GMT Wednesday, 9cts above its NYMEX close of $52.51,
which was down $1.13 on the day. In the US Gulf, 471,328 b/d of crude still
remains shut-in following Hurricane Ivan. In Norway, an expansion of a
three-month strike by the Norwegian Oil Workers Union has curtailed 55,000 b/d
of production. Meanwhile, Russia's justice ministry is preparing to sell
troubled Russian oil major Yukos's main production unit Yuganskneftegaz, which
pumps 1-mil b/d, to recover billions of dollars in unpaid taxes.

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