World oil prices moved in different directions on Tuesday when trading was resumed in New York crude.
New York’s main contract, light sweet crude for delivery in October, tumbled 83 cents to $68,36 per barrel in electronic deals before the official opening of the United States market.
In London, Brent North Sea crude for October delivery gained 14 cents to $67,85 per barrel in electronic trade.
New York’s losses mirrored heavy falls for Brent on Monday, which were caused by easing supply concerns. Trading in New York was closed on Monday owing to the Labour Day public holiday in the US.
Earlier on Tuesday, the price of New York crude fell to $67,77 — the lowest point since May 22. It has plunged more than $10, or 14%, since striking an all-time high of $78,40 in mid-July.
Brent fell to $67,42 early on Tuesday, a level last struck on June 19.
Crude futures have been falling heavily on speculative selling owing to the absence of a severe hurricane threat and on expectations that major crude Iran would not soon face economic sanctions, according to energy analysts.
”A lot of the bullish factors seemed to have disappeared or eased, which has added to the price fall,” said Tony Nunan, a Tokyo-based energy risk manager for Mitsubishi. ”The main factor is the Iran issue as the UN [United Nations] gave Iran another two weeks and Iran seems to be ready to talk [about its nuclear programme].”
The UN Security Council had given Iran until August 31 to suspend its uranium enrichment work or face possible sanctions, but Tehran defied the deadline. Further talks with European powers are now planned.
The US and other major world powers suspect that Iran is using its nuclear enrichment programme as a cover to make nuclear weapons. Iran has claimed that it is for peaceful energy purposes.
A German government spokesperson said on Monday that high-ranking officials from the five permanent members of the Security Council plus Germany will meet this week for further discussions on resolving the Iranian nuclear stand-off. The US will follow a planned meeting between European Union foreign policy chief Javier Solana and Iran’s top nuclear negotiator Ali Larijani.
Solana has told EU foreign ministers that he and Larijani are ”due to meet somewhere in Europe, sometime soon this week”, Jaeger said.
Oil analyst Nunan said the mild hurricane season in the Atlantic Ocean also contributed to the recent price falls because it eases the threat to US oil-production facilities in the Gulf of Mexico. — Sapa-AFP