29 April 2008 11:42 [Source: ICIS news]
SINGAPORE (ICIS news)--Crude futures fell by more than $1/bbl on Tuesday in Asia, pushing NYMEX light sweet crude futures below $118/bbl following the end of a strike at the Grangemouth refinery and ahead of a keenly awaited meeting of the US Federal Reserve.
At 09.45 GMT on Tuesday, June NYMEX light sweet crude futures were trading at $117.74/bbl, down $1.01/bbl from Monday’s settlement price. Earlier, the contract fell to a low of $117.47/bbl down $1.28/bbl.
At the same time on Tuesday, June ICE Brent futures were trading at $115.45/bbl, down $1.29/bbl from the previous close, after earlier falling to a low of $115.18/bbl down $1.56/bbl.
Striking oil workers at the key 210,000 bbl/day Grangemouth refinery in Scotland returned to work on Tuesday.
Flows along the Forties pipeline which carries 700,000 bbl/day of North Sea oil production were expected to resume later in the day although full flow rates would take some days to restore.
The Forties pipeline had been shut-in since Sunday as the strike action cut power for pumping the crude to the Hound Point export terminal
Analysts have speculated that the US Federal Reserve, which meets on Tuesday and Wednesday this week, may impose only a modest cut or no cut at all on US interest rates.
Such moves were expected to result in funds moving out of energy and other commodities and into the US dollar.
Crude futures have climbed to a new record high in recent days, with June NYMEX light sweet crude futures peaking on Monday at $119.93/bbl, amid heightened supply fears following civil unrest in Nigeria and industrial action in the UK, which affected North Sea oil production.
Nigerian oil production was reported to have been halved due to the recent civil unrest. Sabotage attacks last week on pipelines in the Niger Delta forced Shell to shut in further production, bring the total to volume shut-in by the company to over 500,000 bbl/day.
Meanwhile, ExxonMobil advised that it had totally shut down all of its Nigerian crude production due to the ongoing oil workers' strike and declared force majeure on all loadings. It was estimated that this was close to 800,000 bbl/day.
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