Oil prices lower
Tuesday, 21 August 2007
SINGAPORE, Aug 20 (AFP): Oil prices fell in Asian trade today as energy facilities in the United States appeared to be safe for the time being from the fury of Hurricane Dean, dealers said.
New York's main contract, light sweet crude for September delivery had fallen 82 cents to 71.16 US dollars a barrel from 71.98 dollars in late US trades Friday.
Brent North Sea crude for October delivery dropped 92 cents to 69.52 dollars.
"Its trajectory is proving to be a far way south... it's becoming less of a worry for the oil market," said Tobin Gorey, a commodity strategist with the Commonwealth Bank of Australia in Sydney.
"As the hurricane (threat) fades, they are focusing on the market turmoil," he said, referring to last week's turbulence in the financial markets, particularly equities, stemming from the troubled US subprime mortgage sector.
The US Federal Reserve's move to slash its discount rate also calmed financial markets but there is still a "question mark over demand for oil," said Gorey.
Oil traders are still trying to determine the fallout from the US subprime market crisis on economic growth which will subsequently affect energy demand, he said.
In a move aimed at boosting the liquidity of commercial banks, the US central bank Friday slashed its discount rate-the short-term loan rate it charges banks-by a half-per centage point to 5.75 per cent.
Meanwhile, Hurricane Dean unleashed the full force of its 230 kilometers (145 miles) per hour winds on Jamaica Sunday, after leaving a trail of destruction in the Caribbean.
New York's main contract, light sweet crude for September delivery had fallen 82 cents to 71.16 US dollars a barrel from 71.98 dollars in late US trades Friday.
Brent North Sea crude for October delivery dropped 92 cents to 69.52 dollars.
"Its trajectory is proving to be a far way south... it's becoming less of a worry for the oil market," said Tobin Gorey, a commodity strategist with the Commonwealth Bank of Australia in Sydney.
"As the hurricane (threat) fades, they are focusing on the market turmoil," he said, referring to last week's turbulence in the financial markets, particularly equities, stemming from the troubled US subprime mortgage sector.
The US Federal Reserve's move to slash its discount rate also calmed financial markets but there is still a "question mark over demand for oil," said Gorey.
Oil traders are still trying to determine the fallout from the US subprime market crisis on economic growth which will subsequently affect energy demand, he said.
In a move aimed at boosting the liquidity of commercial banks, the US central bank Friday slashed its discount rate-the short-term loan rate it charges banks-by a half-per centage point to 5.75 per cent.
Meanwhile, Hurricane Dean unleashed the full force of its 230 kilometers (145 miles) per hour winds on Jamaica Sunday, after leaving a trail of destruction in the Caribbean.