The war clouds over Iraq appear to be thinning and this has had a direct impact on world crude oil prices, which have been heading southwards during the past week.
However, oil prices could have eased further had supply of crude not been restricted by the Organisation of Petroleum Exporting Countries (OPEC). It has decided to retain production curbs at existing levels.
Prices for the international benchmark Brent, which was hovering around $ 29.28 a barrel on September 25, came down to $ 29.02 a barrel the following day, $ 29.01 on September 27 and $ 28.88 on September 28. The average international price of Brent during the current financial year comes to $26 a barrel while the average for the entire month of September works out to $ 28.38 a barrel. The highest prices of Brent during the current financial year was $ 29.52 a barrel on September 23, while the lowest was $ 22.56 a barrel on April 12.
Also Read
Product prices moved in tandem with crude oil prices. While on September 25, naphtha (Singapore) was quoted at $ 28.10 a barrel, it moved down to $ 27.95 the next day, $ 27.63 on September 27 and $ 27.60 on September 28.
Fuel oil (Singapore), which were quoted around $ 26.33 a barrel on September 25, moved up marginally to $ 26.38 a barrel on September 26, came down to $ 26.17 a barrel on September 27 and recovered slightly to $ 26.19 a barrel on September 28. The prices of motor spirit (f.o.b. Singapore), were ruling around $ 29.85 a barrel on September 25, came down to $ 29.68 a barrel on September 26, to $29.40 a barrel on September 27 and again moved up to $ 29.80 on September 28 on increased demand from some Western nations.
Reuters adds from London: Meanwhile, world oil prices climbed on Wednesday as crude stocks in the United States dropped almost five per cent, the second largest weekly fall in almost two decades.
Oil futures had eased after Iraq agreed on Tuesday to the resumption of United Nations weapons inspections but dealers said the market needs tangible signs that Baghdad will open its doors completely to arms experts before prices cool off. International benchmark Brent crude stood 19 cents higher at $29.20 a barrel in London trade by early afternoon.
Benchmark US crude rose to a peak at $31.05 a barrel, the second day in a row that oil has breached the $31 mark and just below the 19-month peak at $31.39 hit late last week. It was trading 11 cents up at $30.94. Fresh weekly data from the American Petroleum Institute (API) showed a massive 13.94 million barrel fall in US crude inventories last week as Tropical Storm Isidore closed oil production in the Gulf of Mexico and shut the Louisiana Offshore Oil Port, the gateway for US oil imports, to shipping.