August 7, 2004 in Business

Crude prices decline from record highs

Associated Press
 

LONDON – Oil prices retreated from record-highs on Friday as concerns about Russian supplies dissipated somewhat and OPEC said it was prepared to raise daily output by more than one million barrels.

A Moscow court ruled that the government acted illegally when it seized shares of a subsidiary of oil giant Yukos, handing the company a significant victory in its battle with the state over alleged back taxes. The outcome of the battle is important to oil markets because Yukos pumps 1.7 million barrels per day, or roughly 2 percent of the world’s supply – a critical amount at a time when demand is strong and global inventories are tight.

The news sent crude futures lower in the United States and Britain.

Light crude for September delivery settled at $43.95 a barrel, down 46 cents from Thursday’s record close of $44.41 on the New York Mercantile Exchange.

September contracts of North Sea Brent crude were at $40.63 on London’s International Petroleum Exchange, down 49 cents from the previous day’s all-time high closing price of $41.12.

Faced with mounting pressure to curb prices, the president of the Organization of Petroleum Exporting Countries backpedaled on Friday from comments he made earlier this week that the group couldn’t immediately boost production.

“We are ready to add another 1.5 million barrels a day but will discuss it first during the next meeting in Vienna,” Purnomo Yusgiantoro, who is also the Indonesian oil minister, told reporters in Jakarta. OPEC’s current output is 30 million barrels a day.

© Copyright 2004 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


Thoughts and opinions on this story? Click here to comment >>

Get stories like this in a free daily email