Oil prices waver on Irene storm downgrade, forecast on the U.S. economy and resumption of Libyan oil supplies
London, United Kingdom (AHN) – Oil markets in London and New York had mixed reactions to the ripples of recent events: production in the northern East Coast of the United States was not disrupted with the downgrade of Irene from hurricane to storm, prospects of a growing U.S. economy over the long term as announced by Federal Reserve chief Ben Bernanke, and the resumption of oil production in Libya.
Futures were mixed after peaking as much as 0.4 percent. Prices at the New York Mercantile Exchange for October delivery was at $85.27 a barrel, down 10 cents. The contract advanced 7 cents on last Friday to $85.37, the highest since August 23.
Brent oil in London’s ICE Futures Europe exchange for October settled at $111.10 a barrel, falling 26 cents. Crude from the North Sea traded at a premium of $25.81 to U.S. futures, compared with a record $26.21 last August 19.
Analysts speculated that growth in the U.S. would resume with Bernanke’s cautious stance on the economy, triggering more demand for oil in the world’s largest crude consumer.
Disruption of oil production in the northern East Coast did not also happen with the Hurricane Irene being downgraded to a tropical storm moving with winds of 50 miles per hour and moving north- northeast at 26 miles per hour.
Rebels in Libya claimed full control of the country’s oil fields. Libyan output is expected to resume in three weeks. The transition government will implement a three-stage plan to return the flow of oil to 1.6 million barrels a day in 15 months.
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