Oil prices fall below $95 on Opec comments
BANGKOK — Oil prices fell below $95 on Wednesday as ample supplies caused energy investors to pull back.
Benchmark oil for July delivery fell 85 cents to $94.53 per barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract fell 39 cents to close at $95.38 per barrel on the Nymex on Tuesday.
Secretary General of Opec Abdalla Salem El-Badri of Libya speaks during a news conference after a meeting of the Organization of the Petroleum Exporting Countries, Opec, at their headquarters in Vienna, Austria, Friday, May. 31, 2013. AP
On Tuesday, oil prices were pressured by OPEC’s disclosure that its members boosted production by 106,000 barrels a day in May. Some experts feel the world already has an ample supply to meet current demand.
“Oil prices have slid back after OPEC increased crude output in May while at the same time keeping its 2013 demand forecast unchanged on concerns about the demand outlook,” said Michael Hewson of CMC Markets in an email commentary.
Investors have been trying to guess the timetable for the US Federal Reserve to wind down its massive bond-buying program. The $85 billion-a-month asset purchases have helped keep interest rates at historic lows, prompting investors to turn to stocks and commodities in search of returns that outdo bonds.
However, Julian Jessop of Capital Economics said in a market commentary that a pullback by the Fed wouldn’t impact oil markets greatly, partly because the program “does not seem to have provided much support for commodity prices to begin with, so there may be little to lose when the asset purchases do end.”
Brent crude, a benchmark for many international oil varieties, fell 35 cents to $102.61 a barrel on the ICE Futures exchange in London.
In other energy futures trading on the Nymex:
— Wholesale gasoline fell 2.3 cents to $2.8006 a gallon.
— Heating oil fell 0.7 cent at $2.8509 per gallon.
— Natural gas dropped 0.3 cents to $3.721 per 1,000 cubic feet.
