7 March 2008
NEW YORK (Reuters) - Oil ended slightly lower on Friday, falling from record highs hit earlier when buying by speculators hedging against the weaker dollar and inflation sent prices above $106 a barrel.
U.S. oil settled down 32 cents at $105.15 a barrel, trimming gains after hitting an all-time high of $106.54 earlier in the trading session. London Brent crude settled 23 cents lower at $102.38 a barrel.
"We rose earlier on the dollar play and expectations that the Fed may have to lower rates," said Rob Kurzatkowski, a futures analyst with optionsXpress.
"This has lately been an inflation and currency play."
A government report showing a second straight month of contractions in U.S. payrolls spurred talk the Federal Reserve might cut interest rates again, weakening the dollar early in the day. The greenback later rebounded, helping to ease oil off earlier highs.
The steady decline in the U.S. dollar has helped push commodity prices higher, while a sharp drop in U.S. crude stocks and OPEC's decision on Wednesday not to increase output also boosted oil prices.
While U.S. crude inventories had been building in recent weeks and U.S. gasoline stocks were at 14-year highs, a U.S. government report showed crude stocks fell by 3.1 million barrels last week, against forecasts for an increase.
The Organization of Petroleum Exporting Countries, which pumps more than a third of the world's oil, has long argued the current high prices do not reflect market fundamentals and are being driven by speculation.
Influential Saudi Oil Minister Ali al-Naimi reiterated that view in remarks published on Friday, saying speculation was behind triple-digit oil and made it impossible for any organization to control price movements.
"Today there is no link between oil (market) fundamentals and prices," he told Moroccan newspaper Asharq al-Awast.
"The duty of oil exporters is to make sure that fundamentals are healthy," said Naimi. "If these fundamentals were stable and fulfill market needs, then there is no need to raise or decrease production."
OPEC will next meet in September, although ministers could confer informally at a conference between consumers and producers in Rome April 20-22.
"Leaving things so open-ended gives me and others a clear impression that the cartel is prepared to let prices run away for the time being. Perhaps they feel the weakness in the dollar would offset any rise in price," said Rob Laughlin at MF Global.
Tensions between OPEC member Venezuela, a top oil exporter to the United States, and neighbor Colombia, also have underpinned oil prices.
Showing posts with label oil. Show all posts
Showing posts with label oil. Show all posts
Friday, March 7, 2008
Monday, January 14, 2008
Time's up for petrol cars, says GM chief
Joshua Dowling Motoring Editor in DetroitJanuary 15, 2008
THE world's biggest car maker, General Motors, believes global oil supply has peaked and a switch to electric cars is inevitable.
In a stunning announcement at the opening of the Detroit motor show, Rick Wagoner, GM's chairman and chief executive, also said ethanol was an "important interim solution" to the world's demand for oil, until battery technology improved to give electric cars the same driving range as petrol-powered cars.
GM is working on an electric car, called the Volt, which is due in showrooms in 2010, but delays in suitable battery technology have slowed the project.
Mr Wagoner cited US Department of Energy figures which show the world is consuming roughly 1000 barrels of oil every second of the day, and yet demand for oil is likely to increase by 70 per cent over the next 20 years. Some experts believe the supply of oil peaked in 2006.
The remaining oil reserves are deeper below the Earth's surface and therefore more costly to mine and refine.
"There is no doubt demand for oil is outpacing supply at a rapid pace, and has been for some time now," Mr Wagoner said. "As a business necessity and an obligation to society we need to develop alternative sources of propulsion."
He added: "So, are electrically driven vehicles the answer for the mid- and long-term? Yes, for sure. But … we need something else to significantly reduce our reliance on petroleum in the interim."
GM is so convinced about ethanol it has signed an agreement with a supplier that claims to have come up with a way of producing ethanol that is cheaper and more efficient than refining oil. The supplier claims it can produce ethanol from "almost any material" such as farm waste, municipal waste, discarded plastics - even old tyres.
The car industry has had a love-hate relationship with ethanol, which is most commonly derived from crops such as corn, wheat and sugar cane. At first, car makers criticised ethanol-blended fuel because most vehicles weren't compatible with it. Then car makers changed their tune and embraced ethanol-blended fuel after retuning engines to suit the new mix.
THE world's biggest car maker, General Motors, believes global oil supply has peaked and a switch to electric cars is inevitable.
In a stunning announcement at the opening of the Detroit motor show, Rick Wagoner, GM's chairman and chief executive, also said ethanol was an "important interim solution" to the world's demand for oil, until battery technology improved to give electric cars the same driving range as petrol-powered cars.
GM is working on an electric car, called the Volt, which is due in showrooms in 2010, but delays in suitable battery technology have slowed the project.
Mr Wagoner cited US Department of Energy figures which show the world is consuming roughly 1000 barrels of oil every second of the day, and yet demand for oil is likely to increase by 70 per cent over the next 20 years. Some experts believe the supply of oil peaked in 2006.
The remaining oil reserves are deeper below the Earth's surface and therefore more costly to mine and refine.
"There is no doubt demand for oil is outpacing supply at a rapid pace, and has been for some time now," Mr Wagoner said. "As a business necessity and an obligation to society we need to develop alternative sources of propulsion."
He added: "So, are electrically driven vehicles the answer for the mid- and long-term? Yes, for sure. But … we need something else to significantly reduce our reliance on petroleum in the interim."
GM is so convinced about ethanol it has signed an agreement with a supplier that claims to have come up with a way of producing ethanol that is cheaper and more efficient than refining oil. The supplier claims it can produce ethanol from "almost any material" such as farm waste, municipal waste, discarded plastics - even old tyres.
The car industry has had a love-hate relationship with ethanol, which is most commonly derived from crops such as corn, wheat and sugar cane. At first, car makers criticised ethanol-blended fuel because most vehicles weren't compatible with it. Then car makers changed their tune and embraced ethanol-blended fuel after retuning engines to suit the new mix.
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