Oil prices plunge after Nigeria strike called off<\/p>\n
Reuters, London<\/p>\n
Oil prices fell sharply on Tuesday after a general strike in
\nNigeria was called off, removing concerns over possible supply
\ndisruption from the two million-barrels-per-day OPEC producer.<\/p>\n
Benchmark Brent crude oil in London was down 46 U.S. cents to
\nUS$27.36 a barrel, while U.S. light crude futures had dropped 43
\nU.S. cents to $29.70 a barrel, losing ground for the second
\nconsecutive day.<\/p>\n
Nigeria's unions said on Tuesday they were calling off a
\ngeneral strike over petrol pump prices after reaching a deal with
\nthe government.<\/p>\n
The leaders of the umbrella Nigeria Labor Congress (NLC)
\nissued a statement, saying they were ending the strike after the
\ngovernment agreed to back down and reduce petrol prices from 40
\nnaira to 34 naira per liter.<\/p>\n
Crude oil exports in the world's eighth largest exporter had
\nhowever remained unaffected by the week-long strike.<\/p>\n
\"In the short term the market is rather bearish,\" said Steve
\nTurner, an analyst with Commerzbank Securities in London. \"We
\nbelieve the downtrend is likely to continue with the current high
\nlevel of OPEC production.\"<\/p>\n
However, OPEC production, only slightly exceeding in June its
\n25.4 million barrel per day self-imposed production ceiling, is
\npartly compensating for a lack of Iraqi oil production,
\nstruggling to restart after the war, analysts said.<\/p>\n
Iraq's northern export pipeline from the Kirkurk oilfields to
\nthe Turkish Mediterranean port of Ceyhan was damaged by a new
\nsabotage blast over the weekend, further dashing hopes of raising
\ncrude exports, crucial to funding rebuilding.<\/p>\n
\"There's no illusion that Iraqi production will be sporadic
\nand volatile, so it was no real surprise,\" said Turner.<\/p>\n
Baghdad is planning to sell only eight million barrels of oil
\nin July, all from its southern fields, at a rate of 260,000
\nbarrels per day, well below its previous target for that period.<\/p>\n
Iraq was selling more than two million barrels daily before
\nthe war from a production of about 2.7 million bpd.<\/p>\n
Analysts said even though oil prices were on a downtrend, OPEC
\nwas unlikely to change its production limits at its extraordinary
\nmeeting in Vienna on July 31, as prices still remained at the top
\nend of OPEC $22-$28 price band.<\/p>",
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