Oil prices slightly lower due to profit-taking
Oil prices slightly lower due to profit-taking
SINGAPORE (Reuters): Oil prices were slightly lower on Monday
as the market stepped back from last week's gains and cashed in
some profits.
Benchmark October delivery U.S. light crude futures last
traded at 0656 GMT (01.56 at Jakarta time) at US$27.95 barrel,
down eight cents from Friday when the market had jumped 45 cents
to close at $28.03 in New York.
Monday's slight decline in prices, attributed to profit
taking, was in thin trading.
"Some selling came out so prices are a bit off, but traded
volumes are really light," a New York broker said.
On Friday, declining fuel stocks in the United States and a
reduction in OPEC output brushed aside news that U.S.
unemployment had risen to a four-year high and heightened concern
the economic downturn could deepen.
The Organization of the Petroleum Exporting Countries curbed
output for a third time this year -- a million barrels per day,
or four percent, from Sept. 1 -- to counter the negative impact
on crude prices from the economic malaise and to prop up oil
revenues.
Meanwhile, long-running wrangling between Iraq and the United
Nations over the pricing of Baghdad's sanctions-bound crude
exports continued to threaten to disrupt supplies.
Britain and the United States are pushing the United Nations
for shorter pricing periods for Iraqi oil sales in an effort to
stem illegal surcharges Iraq receives from buyers.
Russia on Thursday rejected an Anglo-American proposal to
approve Iraqi oil prices for first-half September U.S. shipments
instead of for the whole month.
Meanwhile, a Reuters survey said OPEC oil output rose in
August, fuelled by a return to full flows from Iraq and growing
leakage from the rest of the group that will raise fresh concerns
about quota compliance.
The survey put overall production up 970,000 barrels a day for
the month at 28.01 million bpd from 27.04 million in July.
Output from 10 OPEC members with quotas, excluding Iraq, edged
up 260,000 bpd to 25.22 million, according to the survey of
industry officials and OPEC monitors.
That put the group 1.02 million bpd in excess of official
limits for the 10 of 24.2 million during August compared to
leakage of 760,000 bpd in July.
Having decided to reduce production by another million barrels
daily, that output target was cut to 23.2 million from September.
Monitors see little prospect of the group meeting its target at
the first attempt this month.
Extra leakage in August was noticeable from Saudi Arabia and
Nigeria. But while Saudi's extra 225,000 bpd puts it nearly three
percent over quota, Nigeria's 227,000 bpd puts it 11 percent
above quota, making it OPEC's least compliant member.
Iraqi output in August was lifted by U.N.-supervised exports
that rose to 2.09 million, up about 700,000 bpd on the month.
Supplies have been maintained despite continued tension over
pricing. Exports eased in the last week of August to 1.86 million
bpd after peaking the previous week at 2.4 million.