LONDON, Dec 28: World oil prices dipped slightly Wednesday on expectations of warmer weather in the United States, the world’s biggest consumer of energy, analysts said.
New York’s main contract, light sweet crude for delivery in February, eased eight cents to $58.08 per barrel in electronic trading.
In London, the price of Brent North Sea crude for February delivery dipped two cents to $56.27 per barrel.
Crude futures remained under pressure from the mild US weather lowering demand for heating oil, analysts at the Sucden brokerage firm said.
Prices were weighed down also by crude output returning to normal in Nigeria after a pipeline attack in Africa’s biggest oil producer last week, they added.
Energy giant Royal Dutch Shell had said that unknown assailants attacked its pipeline near the main oil city Port Harcourt, resulting in a major spill and fire that slashed production by about seven per cent of Nigeria’s total crude export.
Temperatures in the US northeast region, the worlds largest consumer of heating fuel, were meanwhile expected to rise further above normal levels by the end of the week, according to weather forecaster Meteorlogix.
Elsewhere, the US National Weather Service has predicted the mild temperatures to remain through to March.
Amid such weather conditions, some analysts said there appeared to be sufficient energy supplies to meet demand during the northern hemisphere winter.
US reserves of crude have increased by 12.4 per cent over the last year, while stockpiles of heating fuel are up 11.1 per cent, according to the US Department of Energy.
Despite the bearish outlook, CFC Seymour analyst Dariusz Kowalczyk said the situation could alter.
It all depends on the weather which is unpredictable, but things can change. The winter is still quite long and anything can happen, he said.
Amid falling prices meanwhile, Opec’s second biggest producer Iran wants the oil cartel to cut its output ceiling by one million barrels per day (bpd) at its next meeting on January 31, Oil Minister Kazem Vaziri-Hamaneh said in comments published Wednesday.—AFP
