Nov. 17 (Bloomberg)

Crude Oil Trades Near One-Year Low on Doubts About OPEC Cuts -
By Hector Forster and Nesa Subrahmaniyan


Oil, set for its biggest weekly decline since October 2005, traded near a one-year low on speculation OPEC will exceed its production target.

Crude plunged 4.3 percent yesterday after Halifax, England- based consultant Oil Movements said November shipments by the Organization of Petroleum Exporting Countries will rise. OPEC last month agreed to cut output by 1.2 million barrels a day, or 4.4 percent.

``OPEC has to get their act together,'' said Anthony Nunan, deputy general manager for international petroleum business at Tokyo-based Mitsubishi Corp., Japan's biggest trading house. ``That's what the market's saying.''

Crude oil for December delivery fell as much as 27 cents, or 0.5 percent, in after-hours electronic trading on the New York Mercantile Exchange, to $55.99 a barrel, taking the decline this week to 6 percent, the largest drop since the week ended Oct. 7 last year.

Yesterday, the futures slumped $2.50 to $56.26, the biggest one-day decline since Aug. 17, 2005. The December contract expires today.



Oil Movements

OPEC's shipments rose 0.9 percent in the month to Dec. 2 to 24.8 million barrels a day from 24.6 million barrels a day in the four weeks ended Nov. 4, Oil Movements said in a weekly report yesterday.

Above-average temperatures will cover the northern third of the U.S. from coast to coast this winter as an El Nino weather pattern persists, the U.S. Climate Prediction Center said yesterday in a report that covers December through February. A warmer-than-normal winter in the region would reduce demand for fuels used to run household and commercial furnaces.

``The temperature situation in the U.S. is not helping,'' said Andrew Harrington, a commodities analyst at Australia & New Zealand Banking Group Ltd. in Sydney.

El Nino refers to the warming of the ocean surface off the western coast of South America. The phenomenon affects the jet stream, alters storm tracks and creates unusual weather patterns. A moderate to strong El Nino typically brings mild winters to the northern U.S.

FT.com - November 17 2006

Crude falls after natural gas data - By Chris Flood


Oil prices reversed early strength and retreated on Thursday after the release of the latest US weekly natural gas inflows added to record stock levels as winter approaches.

ICE January December Brent fell 77 cents to $59.84 a barrel. Nymex December West Texas Intermediate, due to expire today, dropped $1.08 to $57.68 a barrel, but there was more trading volume in the January WTI contract, down 80 cents to $59.92 a barrel.

Crude has been range trading since the start of October. The decline in crudes price volatility in recent months is in line with equities and bonds but contrasts with increased volatility for some metals and agricultural products.

Rangebound trading has led to the virtual disappearance of speculative long positions in the crude market. But Francisco Blanch, commodity strategist at Merrill Lynch, said the current stability of crude prices might not last long due to a strong outlook for demand growth in emerging markets, an energy investment shortage and weaker production growth from non-Opec countries.

Analysts at Barclays Capital said: The market is ultimately going to face over-tightening and the longer it takes before a more significant move up, the more vicious is likely to be the whiplash when they do start to move.

Nymex December Henry Hub fell 25 cents to $7.867 per million British thermal units after the Energy Information Administration said gas in storage rose 5bn cubic feet last week.

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