LONDON, 14 October 2004 — World oil prices fell yesterday as traders banked profits after a surge above $54, though analysts still expected prices to break new records with inventories low going into winter in key markets. The price of reference light sweet crude for delivery in November dropped 46 cents to $52.05 a barrel in early trading on the New York Mercantile Exchange.
New York’s main oil contract pierced $54 for the first time Tuesday, reaching $54.45 on concerns over strikes in major producers Nigeria and Norway, before sliding as investors locked away fat profits.
In London, Brent North Sea crude oil for November delivery lost 65 cents to $48.95 in late deals. It had hit a record $51.50 on Tuesday. “The oil market has been very volatile in the last couple of days. There was a big sell-off yesterday on profit taking,” Investec analyst Bruce Evers said.
“But prices are back up this morning which just proves that people are buying the dip,” he said as prices staged a brief rally before falling back. “They fear it might be the last chance to get cheaper crude. I still think we are going to see 60 dollars for light sweet crude before we see 50.
In Norway, the world’s third-biggest exporter of crude, strike action by some 200 off-shore workers that has lasted since the beginning of July was set to widen yesterday with another 25,000 barrels per day of production expected to be cut, shutting in a total of 55,000 bpd, or two percent.