Brent trades rangebound after steep fall on easing US storm fears

London (Platts)--29Aug2006

ICE Brent futures in London traded in a tight range around Monday's
settle as the market took a breather from a heavy fall on news that Tropical
Storm Ernesto's posed no danger to oil and gas infrastructure in the US Gulf
of Mexico.
At 1049 GMT, the October Brent futures contract was changing hands at
$71.02/barrel, up 20 cents from the overnight settle.
On Monday, the Brent contract fell to an intra-day two month low of
$70.44/barrel a fall of $3.65 from Friday's high. From Friday's settle, the
October Brent contract fell Monday $1.86/barrel on the back of the bearish
forecast of Tropical Storm Ernesto.
"Prices fell $2/barrel yesterday which is slightly strange considering it
didn't rise that much last week in response to the potential of it hitting oil
rigs and refineries," a broker said.
The current path and forecast of Ernesto, according to the National
Hurricane Center, sees the tropical storm reaching Florida on Wednesday and
then moving northwards to reach Pennsylvania by the weekend.
Market players said that crude prices are being led very little by
fundamental factors. Already, the market is looking to Wednesday's US
inventory report from the Energy Information Administration and the American
Petroleum Institute.
Market sources in Asia were expecting draws in both crude and gasoline
stocks in Wednesday's US petroleum data. Sources were also anticipating a
small build in distillates.

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