Oil prices ended down again after an intraday rollercoaster ride to have the largest 2 day decline in oil prices in 19 months. WTI prices initially fell to $51.29/bbl before rising to $52.80/bbl then falling back down to $50.92/bbl. The sell off remains a combination of traders selling following crude stock builds in the US and China's decision to increase interest rates 0.25 basis points...the first interest rate increase in 9 years...which some people think will slow down oil consumption. To put it all into perspective, crude stocks whilst rising are still below last year, distillate stocks are very low versus last year and 5 year average and the interest rate rise in China is very small and unlikely to have that much of an impact in consumption.

 

Singapore prices fell $2.23/bbl in line with crude at the time with traders cutting their length. The physical markets remain quiet and well offered but not aggressively so. Kerosene is still being supported by expected demand in Japan. Prices are expected to drop $1.20/bbl this morning.

 

Closing Prices Thursday October 28, 2004:

WTI                    $50.92/bbl            -$1.54/bbl

Brent                  $48.37/bbl            -$1.08/bbl

IPE Gasoil          $462.75/t             -$8.50/t = -$1.14/bbl