Brent recovers to $133/bbl after price plunge

20 June 2008 10:25  [Source: ICIS news]

SINGAPORE (ICIS news)--Brent crude prices gained more than $1/bbl on Friday to climb back above $133/bbl, after a plunge of well over $4/bbl the previous day on news that China planned to raise fuel prices which led to expectations of a decline in demand.

At 8:29 GMT on Friday, August ICE Brent futures were trading at $133.18/bbl, up $1.18/bbl on Thursday’s settlement price, havign earlier risen to a high of $133.35/bbl, up $1.35/bbl.

At the same time, July NYMEX light sweet crude futures traded at $132.90/bbl, up 97 cents/bbl on Thursday’s settlement level.

Earlier the contract hit a high of $133.11/bbl, up $1.07/bbl. The July NYMEX contract expires at the close of Friday’s trading session.

Traders continue to watch developments in Nigeria, the world's eighth largest exporter, after Shell was forced to shut in 220,000 bbl/day of production from the offshore Bonga field following an attack by armed militants in speedboats.

Market observers are also monitoring a meeting between consumers and producers in Saudi Arabia this coming weekend to discuss the causes for high energy prices.

Saudi Arabia, the world’s largest exporter, has agreed to increase production in July to 9.7m bbls/day, the highest output rate since August 1981.

The longer term impact of Saudi output increases were reported to be hard to judge as much of the production will be in heavier fuel oil rich grades rather than the lighter distillate-rich grades favoured by refiners and the market.

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By: James Dennis
+65 6780 4359

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