|
|
|||
|
|||
|
|
Oil Prices Surge Past $53 After Pipeline Blast in Mexico NewsMax.com WiresNEW YORK – Crude oil futures rallied back above $53 late on Wednesday on speculation and panic sparked by an explosion at an oil line in Mexico. Traders were also nervously monitoring developments in Nigeria's national strike and recovery efforts in the Gulf of Mexico. Story Continues Below Crude for November delivery surged $1.13 to settle at $53.64 a barrel on the New York Mercantile Exchange, after falling as low as $51.49 in morning trading. On Tuesday, light, sweet crude settled at $52.51 after hitting an all-time high of $54.45. A 30-inch oil line exploded in eastern Mexico on Wednesday morning, according to local officials. Enrique Fonseca, chief for the communication center of the Veracruz state civil defense agency, said workers from the government oil company Petroleos Mexicanos, or Pemex, had closed off the line and were working to contain the spilled oil. The news was enough to set off buying in an already-jittery market atmosphere, said Ed Silliere, vice president of risk management at Energy Merchant LLC in New York. "It looked as if we were starting a corrective phase in the market," Silliere said. "But you don't expect a correction to last one day .... That's not normal." Although the strength of the rally came as a surprise to many, analysts nevertheless had not expected yesterday's drop to last for long. "I think the selloff yesterday and the selloff today were more technical in nature than fundamentally driven," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago. "It's hard to find too many reasons to be negative on prices, at least for the near-term." Rising prices have been driven by tight supplies. The American Petroleum Institute reported Wednesday that U.S. oil production fell 15 percent in September to the lowest monthly level in more than half a century, led by sharp declines in output from Alaska and the hurricane-hit Gulf of Mexico region. In the same month, the API said, total U.S. demand grew 3 percent compared to a year ago. Though oil prices are around 60 percent higher than a year ago, they are still more than $27 below the peak inflation-adjusted price reached in 1981. Many market observers say prices are likely to continue to skyrocket because of continuing concerns about supply.
© 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.
Editor's note: Read more on this subject in related Hot Topics: |
|
|||||||||||||||||
|
|||||||||||||||||||
|
| All Rights Reserved © 2008 NewsMax.Com |