Singapore: World oil prices fell in Asian trade Tuesday with market attention turning back to a slowing US economy, analysts said.
In morning trade, New York’s main contract, light sweet crude for delivery in March, fell 27 cents to $93.32 per barrel.
The contract closed up $1.82 at $93.59 a barrel during floor trading on Monday at the New York Mercantile Exchange, partly on threats by Venezuelan President Hugo Chavez to cut oil sales to the United States, dealers said.
Brent North Sea crude for March fell 25 cents to $93.28 per barrel after settling up $1.59 at $93.53 a barrel in London on Monday.
“Market participants do not believe in Chavez’s rhetoric, and so we see prices adjusting downwards,” said Victor Shum, senior principal at Purvin and Gertz international energy consultants in Singapore.
On Sunday Chavez threatened to cut oil sales to the United States if US oil giant ExxonMobil succeeds in getting billions of dollars in Venezuelan assets as compensation for expropriated oil fields.
Chavez made his latest threat on Sunday after ExxonMobil secured international court orders freezing up to $12 billion in assets of Venezuela’s state oil firm Petroleos de Venezuela (PDVSA).
Venezuela is the fourth largest supplier of oil to the United States, with daily exports of about 1.3 million barrels.
Shum said the market is more concerned with other issues including those in Nigeria, and colder weather in the US, but “concern over a US recession is still dominant.”
Fears that the US economy could be entering a recession, with a likely decline in energy demand, have spooked oil markets recently.
In the latest incident in Nigeria, gunmen attacked a gas export plant in the south of the country, killing a naval officer and forcing several others to dive for their lives into the water, the navy said.
The unknown attackers stormed the multibillion-dollar liquefied natural gas plant at Bonny Island in Rivers State and shot at navy personnel before fleeing, a naval spokesman told AFP.
Anglo-Dutch oil group Shell said Thursday it would not be able to honour all its export contracts from its Bonny export terminal for the rest of February and March because of sabotage.
Shell is Nigeria’s largest oil operator, accounting for around half of the country’s daily output of 2.6 million barrels at peak production. Unrest in the Niger Delta has slashed output by a quarter since January 2006.
“In the near term, crude oil futures will likely be between the high 80s and low 90s,” Shum said.