Oil slips to USD 102 after record high

Oil prices slipped Tuesday after climbing to a new record of almost USD 104 a barrel a day earlier, the AP says.

Izvor: AP

Tuesday, 04.03.2008.

15:24

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Oil prices slipped Tuesday after climbing to a new record of almost USD 104 a barrel a day earlier, the AP says. The decline came as it appears OPEC ministers, gathering for a meeting Wednesday, have all but ruled out pumping more oil to ease record-high prices. Oil slips to USD 102 after record high Light, sweet crude for April delivery on the New York Mercantile Exchange fell 45 cents to USD 102.00 a barrel in electronic trading by midday in Europe. The contract traded as high as USD 103.95 a barrel Monday before retreating to settle at USD 102.45, up 61 cents from the end of last week. Oil futures - propelled by the weak U.S. dollar - climbed past USD 103.76 a barrel Monday on the New York Mercantile Exchange, breaking what many analysts consider to be the true record high for oil after the USD 38 per barrel price from 1980 is adjusted for inflation. The dollar's decline to historic levels Monday was spurred by news that construction spending in the U.S. took its biggest nosedive in 14 years. Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is falling. Gold, copper and wheat are among the other commodities that have rallied as the dollar has fallen. Investors are also keeping an eye on Wednesday's OPEC meeting. Most expect the Organization of Petroleum Exporting Countries to hold output steady. Analyst estimates for where oil goes from here vary widely. Some predict an eventual decline to the USD 65 or USD 70 range as supplies continue to grow and demand falls. Others see prices rising as high as USD 120 as investment capital continues to flow into oil.

Oil slips to USD 102 after record high

Light, sweet crude for April delivery on the New York Mercantile Exchange fell 45 cents to USD 102.00 a barrel in electronic trading by midday in Europe. The contract traded as high as USD 103.95 a barrel Monday before retreating to settle at USD 102.45, up 61 cents from the end of last week.

Oil futures - propelled by the weak U.S. dollar - climbed past USD 103.76 a barrel Monday on the New York Mercantile Exchange, breaking what many analysts consider to be the true record high for oil after the USD 38 per barrel price from 1980 is adjusted for inflation.

The dollar's decline to historic levels Monday was spurred by news that construction spending in the U.S. took its biggest nosedive in 14 years.

Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is falling. Gold, copper and wheat are among the other commodities that have rallied as the dollar has fallen.

Investors are also keeping an eye on Wednesday's OPEC meeting. Most expect the Organization of Petroleum Exporting Countries to hold output steady.

Analyst estimates for where oil goes from here vary widely. Some predict an eventual decline to the USD 65 or USD 70 range as supplies continue to grow and demand falls. Others see prices rising as high as USD 120 as investment capital continues to flow into oil.

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