OPEC President Chakib Khelil said there's no need to increase supply, citing factors outside of OPEC's control, including the weak U.S. dollar and U.S. pressure on Iran, for high oil prices. Khelil also blamed the U.S. mortgage crisis and speculators for driving oil prices higher.
The United States and the European Union want Iran to end uranium enrichment, a technology which would give Iran the materials needed to produce a nuclear bomb. Iran says it wants the nuclear technology solely to produce energy. If one discounts oil sands, Iran, also a member of OPEC, has the world's second largest proved oil reserves, after Saudi Arabia.
Khelil's comments had little impact on the oil market Tuesday. Oil closed down 19 cents to $136.55 in a session devoid of major price moves -- a rarity for the oil markets in the past two years.
Oil: A record year
Oil hit a record $139.89 per barrel on June 16, 2008, is up more than 100% in the past year, and more than 400% since 2000.
The other major energy commodities closed mixed Tuesday. Heating oil rose 4 cents to $3.80 per gallon, unleaded gasoline fell about 1 cent to $3.45 per gallon, and natural gas declined 24 cents to $12.96 per million BTUs.
Traders and analysts said the oil market will take its cue from Wednesday's weekly U.S. oil inventory report, released by the U.S. Energy Information Agency at 10:35 a.m. EDT.
Oil Analysis: Wednesday may be a pivotal day for the oil markets. On the heels of Saudi Arabia's announced production increase, if traders interpret the U.S. Federal Reserve's Tuesday monetary policy decision as hawkish (with an interest rate increase likely in the future), and if weekly U.S. oil inventories rise, oil may sell-off considerably.
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Reader Comments (Page 1 of 1)
6-24-2008 @ 5:00PM
bill said...
Why do we defend the middle east? We get the short end of everything any more. The bush adminastration is the worst i have everr seen. Bring on the elections!
6-24-2008 @ 5:06PM
bill said...
Why do we defend the middle east? We get the short end of everything any more. The bush adminastration is the worst i have everr seen. Bring on the elections!