Oil prices fell back below 24 a barrel on Thursday as the market digested indications that Iraq was ready to resume exports through Turkey.
Cold weather on both sides of the Atlantic and lower US reserves for heating oil could not underpin the market, and Brent North Sea crude for February delivery slipped to $23.84 a barrel from $24.04 overnight.
In New York, the February light sweet crude contract fell 10 cents in early trading on Thursday to $26.37 a barrel.
Prices had been galvanized by falling temperatures in the United States and warnings from members of the Organization of Petroleum Exporting Countries (OPEC) that it was time to cut output to give prices a fresh shot in the arm.
But rumors that Iraq was ready to resume exporting through Turkey persuaded market players that fresh crude supplies would soon be hitting the market.
"The market could not sustain its strength as news concerning Iraqi exports from the Ceyhan port dampened buyers' spirits," said the GNI brokerage in a research note.
Having suspended exports at the end of November amid a row with the United Nations over the oil-for-food programme, Iraq began shipping out crude again earlier this month from the Mina-al-Bakr port in the south of the country, according to UN officials in Baghdad.
But the officials have as yet given no word on the status of Iraqi exports which leave the country through a pipeline into Turkey, for ultimate export from the Ceyhan terminal.
Diplomatic and industry sources told AFP on Thursday that activity at Mina al-Bakr in the second half of December had moreover been disrupted by holidays and the lack of a pricing formula.
But the market is still factoring Iraq's 2.4-million-barrels-a-day export capacity back into the equation, and against such a backdrop fresh US stock figures showing a fall in refined products had but a limited impact on prices.
Crude stocks fell last week by two million barrels to 288.98 million barrels, according to the American Petroleum Institute.
Gasoline stocks fell 2.1 million barrels to 197 million, while distillate fuel stocks, which include heating oil used for domestic energy, fell 1.9 million barrels to 114.7 million.—AFP.
©--Agence France Presse.
© 2000 Mena Report (www.menareport.com)
