Newspaper article THE JOURNAL RECORD

Crude Oil Prices Decrease; Others Energy Futures Follow

Newspaper article THE JOURNAL RECORD

Crude Oil Prices Decrease; Others Energy Futures Follow

Article excerpt

NEW YORK -- Crude oil fell to its lowest price in almost four years as expectations that mild weather would weaken heating oil demand outweighed concern that a renewed dispute over weapons inspections in Iraq would disrupt oil supplies.

Prices dropped in early trading on a forecast late Friday by the National Weather Service calling for above-normal temperatures Thursday through Monday across most of the United States. Mild winter weather in the United States has reduced demand for heating oil.

Oil futures pared losses, though still closed lower, after Iraq said it would ban inspections by a United Nations team because it was dominated by U.S. personnel. The dispute could lead to an escalation of military tensions, such as occurred in November when Iraq temporarily expelled American inspectors. "We've got more warm weather on the horizon, according to the latest six- to 10-day forecast," said Rich Redash, an energy futures analyst at Prudential Securities Inc. in New York. "It's all conspiring to push prices lower," Crude oil for February delivery fell 16 cents, or 1.0 percent, to $16.47 a barrel on the New York Mercantile Exchange, the lowest closing price for a contract closest to expirations since April 14, 1994. Earlier it fell as much as 2.0 percent to $16.30. On London's International Petroleum Exchange, February Brent crude fell 17 cents, or 1.1 percent, to $15.33 a barrel, the lowest closing price since April 28, 1994. February heating oil fell 0.49 cent, or 1.0 percent, to 46.21 cents a gallon on the Nymex, the lowest settlement for a contract closest to expiration since July 21, 1995. U.S. stockpiles of heating oil and other distillate fuels as of Jan. 2 were 8.7 percent higher than a year earlier, according to the American Petroleum Institute. Oil prices rebounded from early lows once traders became aware of the latest dispute over Iraqi weapons inspections. "With prices so low, people are going to be extremely quick to cover positions and buy; especially if you get an Iraqi headline," said Abe Glass, a trader at Spear, Leeds & Kellogg in New York. …

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