NYMEX crude opens $1.25/barrel lower as supply concerns fade

NYMEX crude opens $1.25/barrel lower as supply concerns fade

New York (Platts)--14Aug2006

September crude futures on the New York Mercantile Exchange opened
$1.25/barrel lower Monday as the Middle East began to simmer down on a
tentative ceasefire between Israel and Lebanon and BP appeared capable of
keeping half of its 400,000 b/d Prudhoe Bay production on line while pipelines
are being repaired.

By 1422 GMT, the September WTI contract in New York was $1.50/barrel
lower at $72.85/barrel.

"While the decision by BP to maintain the western field in the process of
restoring output to about 200,000 b/d from Prudhoe Bay obviously carry bearish
implications for today's trade, we are inclined to believe that much of this
decision should have been discounted in Friday's lackluster trade since
political pressures favored strong odds of maintaining the western field,"
energy consultant Jim Ritterbusch said in a report.

September unleaded gasoline opened 6.68 cents lower at $1.9975/gal and
September RBOB opened 9.24 cents lower at $2.04/gal as Shell ramped up Bonny
production to 370,000 b/d.

"Also, given Nigeria's unexpected resumption of Bonny Light shipments
following recent disruptions, the market appears back to about square one
because gasoline rich Nigerian cargoes will largely offset the lost ANS
barrels," Ritterbusch said.

September heating oil opened 2.96 cents lower at $2.0110/gal.

--Linda Rafield, linda_rafield@platts.com

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