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Crude Oil Prices Close Lower on Adequate Supply

Posted on: Thursday, 18 August 2005, 09:00 CDT

Crude oil prices close lower on adequate supply

NEW YORK, Aug. 17 (Xinhua) -- Crude oil futures fell nearly 3 dollars Wednesday, the biggest decline since April, as a government report showed that US refineries had sufficient supplies to meet demand for the final summer weeks.

On the New York Mercantile Exchange, light, sweet crude oil futures for September delivery fell 2.83 dollars to end at 63.25 dollars a barrel, while London's Brent crude oil futures for October delivery declined 2.67 dollars to close at 62.56 dollars per barrel.

On Wednesday, the Department of Energy released its weekly inventory report, showing that oil inventories were almost 10 percent higher than a year ago. With the US Labor Day holiday less than three weeks away, refineries were turning their focus to heating oil, whose stockpiles were up 12 percent from this time last year.

While inventories of gasoline fell 4.97 million barrels to 198. 1 million in the week ended Aug. 12, the peak summer gasoline demand was nearly over. As traders shifted their attention to heating oil, they became more confident about the supply in the months ahead.

Meanwhile, the Organization of Petroleum Exporting Countries ( OPEC) said its members would added production capacity in the next 18 months. OPEC expected to increase crude-oil capacity by 2.1 million barrels a day during 2005 and 2006.

The cartel said its total crude-oil output capacity would probably average 33.4 million barrels a day next year, up 710,000 barrels a day from this year.

Source: Xinhua News Agency - CEIS

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