NEW YORK : World oil prices fell sharply Tuesday, with investors shrugging off the possibility of a new OPEC output cut as they focus on slowing global demand.
New York's main contract, light sweet crude for delivery in November, tumbled US$3.36 to close at US$70.89 per barrel. The contract expired at the close.
In London, Brent North Sea crude for December delivery fell US$2.31 to settle at US$69.72 a barrel.
Oil prices had rebounded more than US$4 over the past two sessions on market expectations that the Organization of the Petroleum Exporting Countries (OPEC) would announce an output cut at their special meeting Friday in Vienna.
But prices have since given back most of those gains "as participants react to what appears to be resistance to slashing production by the Saudis," said John Kilduff, analyst at MF Global.
Unlike some other OPEC members who have called for a production cut in the face of declining oil prices, Saudi Arabia, the largest oil producer, has not made its position known.
"Apparently, they are fearful of a spiral of lower prices followed by more cuts," Kilduff said.
Algerian Energy Minister and current OPEC chief Chakib Khelil said over the weekend that the cartel should order a "substantial" cut in production.
Crude futures have halved in value from record highs above US$147 in July.
Crude prices slumped under US$70 last week for the first time in more than a year, dragged down by prospects of reduced demand in the face of a global economic slowdown stemming from the ongoing world financial crisis.
Sucden analyst Nimit Khamar said that price declines on Tuesday were due to profit taking from the recent rally and "persistent concerns over slowing demand for energy due to the cooling global economy, especially with waning demand in the US and China."
Demand bulls got a jolt Monday when China, which has been the biggest driver of demand, announced economic growth slowed to 9.0 per cent in the third quarter, the first time since late 2005 that quarterly growth slipped into single digits.
On Tuesday, Iran's oil minister said Tehran believes OPEC should cut production by between two million and 2.5 million barrels a day, and that prices could go higher than US$150 a barrel.
"The market should find a stable condition, and given the eight to 10 per cent decrease in demand and also given the oil stockpile I think a decrease of between two and 2.5 million barrels a day can bring a stable status to the market," Gholam Hossein Nozari said at a news conference in Tehran.
He added: "Given inflation and the current circumstances of the market, the current oil price is very low, and US$150 should not be out of the question.
"If oil prices do not reach a realistic level, they will go higher (than US$150)," said the minister, whose country is the second-biggest OPEC exporter.
Qatar's Energy Minister Abdallah bin Hamad al-Attiyah said Tuesday that the "best price" for oil was US$80 to US$90 a barrel.
Libya said Monday it backed an output cut of more than one million barrels a day.
On Sunday, Venezuela also lent its support for a cut by OPEC, whose members together pump about 40 per cent of the world's oil.
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They are still dreaming the oil prices at US$150 per barrel !!!!!!!!!!!
New York's main contract, light sweet crude for delivery in November, tumbled US$3.36 to close at US$70.89 per barrel. The contract expired at the close.
In London, Brent North Sea crude for December delivery fell US$2.31 to settle at US$69.72 a barrel.
Oil prices had rebounded more than US$4 over the past two sessions on market expectations that the Organization of the Petroleum Exporting Countries (OPEC) would announce an output cut at their special meeting Friday in Vienna.
But prices have since given back most of those gains "as participants react to what appears to be resistance to slashing production by the Saudis," said John Kilduff, analyst at MF Global.
Unlike some other OPEC members who have called for a production cut in the face of declining oil prices, Saudi Arabia, the largest oil producer, has not made its position known.
"Apparently, they are fearful of a spiral of lower prices followed by more cuts," Kilduff said.
Algerian Energy Minister and current OPEC chief Chakib Khelil said over the weekend that the cartel should order a "substantial" cut in production.
Crude futures have halved in value from record highs above US$147 in July.
Crude prices slumped under US$70 last week for the first time in more than a year, dragged down by prospects of reduced demand in the face of a global economic slowdown stemming from the ongoing world financial crisis.
Sucden analyst Nimit Khamar said that price declines on Tuesday were due to profit taking from the recent rally and "persistent concerns over slowing demand for energy due to the cooling global economy, especially with waning demand in the US and China."
Demand bulls got a jolt Monday when China, which has been the biggest driver of demand, announced economic growth slowed to 9.0 per cent in the third quarter, the first time since late 2005 that quarterly growth slipped into single digits.
On Tuesday, Iran's oil minister said Tehran believes OPEC should cut production by between two million and 2.5 million barrels a day, and that prices could go higher than US$150 a barrel.
"The market should find a stable condition, and given the eight to 10 per cent decrease in demand and also given the oil stockpile I think a decrease of between two and 2.5 million barrels a day can bring a stable status to the market," Gholam Hossein Nozari said at a news conference in Tehran.
He added: "Given inflation and the current circumstances of the market, the current oil price is very low, and US$150 should not be out of the question.
"If oil prices do not reach a realistic level, they will go higher (than US$150)," said the minister, whose country is the second-biggest OPEC exporter.
Qatar's Energy Minister Abdallah bin Hamad al-Attiyah said Tuesday that the "best price" for oil was US$80 to US$90 a barrel.
Libya said Monday it backed an output cut of more than one million barrels a day.
On Sunday, Venezuela also lent its support for a cut by OPEC, whose members together pump about 40 per cent of the world's oil.
==========================================================
They are still dreaming the oil prices at US$150 per barrel !!!!!!!!!!!
