Oil prices extend falls

Aug 07, 2014

Oil prices hit fresh multi-month low points on Thursday as markets gear up for an expected in US gasoline demand, while worries about potential supply disruptions have subsided.

LONDON - Oil prices hit fresh multi-month low points on Thursday as markets gear up for an expected drop in US gasoline demand, while worries about potential supply disruptions have subsided.

US benchmark West Texas Intermediate for delivery in September dropped to $96.58 a barrel, the lowest level for six months.
It later recovered to $96.74, which was however 18 cents lower compared with Wednesday's close.

Brent North Sea crude for September lost 22 cents to stand at $104.37 a barrel in London deals. Earlier Thursday, it reached a four-month low of $104.07.

Market watchers are concerned about lower gasoline use once the so-called US summer driving season ends in a few weeks.
The driving season is the peak demand time for gasoline demand in the US as long road trips are taken for vacations.

US official data released on Wednesday showed a 4.4-million barrel drop in gasoline stocks for the past week.

"Fears that the crises in the Middle East and Ukraine would disrupt supplies have abated, adding to a downward trend in oil prices," Sanjeev Gupta, a leading energy analyst at consultants EY, told AFP.

Oil prices have seen a build in risk premium in recent months over armed insurgencies in crude producers Iraq and Libya, as well as Ukraine which is a key conduit for Russian energy exports to Europe.

But a market awash with supplies have since eased worries that disruptions caused by these geopolitical crises.
Weighing also on oil prices is a firmer dollar, which makes crude priced in the US currency more expensive for holders of rival currencies.

South Sudan oil production 'down about 50%'

50 global firms target Uganda’s oil refinery