Oil prices slump to US$57

01-Nov-06

Oil prices continued sliding for the entire day falling as low as US$57.05 a barrel, and then zipped higher toward the end of the trading session. Light sweet crude for December delivery on the New York Mercantile Exchange settled at US$58.73 a barrel. In London, Brent crude settled at $59.03 a barrel on the ICE Futures exchange. Crude oil futures declined by more than $2 a barrel on Monday, amid mild weather on the East Coast and an expectation that U.S. government data to be released on Wednesday will show rising inventories of crude. The most recent report from Energy Information Administration showed that commercially available supplies of crude oil in the U.S. stands 5% above year ago levels at 332 million barrels, while inventories of distillate, which include heating oil, are 14% above year ago levels at 144 million barrels. Also, doubts persist in the market about OPEC's ability to implement its plan to cut 1.2 million bpd of production.