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= OIL FUTURES: Brent Crude Lower On Nigerian Field Restart
(Comtex Business Via Thomson Dialog NewsEdge)Jan 30, 2006 (Dow Jones Commodities News via Comtex) --By Tim Falconer
Of DOW JONES NEWSWIRES
LONDON (Dow Jones)--Crude oil futures in London gave up a little ground Monday as supply concerns waned after Royal Dutch Shell PLC restarted output at its 115,000-barrel-a-day Niger Delta EA field after a two week shutdown
At 1130 GMT, the front-month March Brent contract on London's ICE Futures exchange - formerly called the International Petroleum Exchange - was down 42 cents at $65.82 a barrel.
The front month March crude contract on the New York Mercantile Exchange was trading 30 cents lower at $67.46/bbl.
The ICE's gasoil contract for February delivery was down $0.50 at $554.00 a metric ton.
Iran is still the central focus for the oil market, but an easing of tensions in the oil-rich Niger-Delta region helped soothe nerves about supply disruptions. The EA field had been shut down for two weeks due to technical problems. About 106,000 b/d of Forcados crude still remains shut in however after recent vandal attacks on a Shell pipeline.
News of the field restart also comes after four foreign oil workers in Nigeria were released by militants earlier Monday after they were abducted Jan. 11.
"We've seen some decent selling as people feel a little more comfortable about the security of the region," said an oil broker in London.
Providing further pressure on prices Monday is the growing likelihood that the Organization of Petroleum Exporting Countries won't budge on production at its meeting in Vienna Tuesday.
Libyan Oil Minister Fathi bin Shatwan said Monday OPEC doesn't need to cut its oil output at its meeting Tuesday, but the group needs to keep a watchful eye on oil prices heading into the second quarter.
Speaking to Dow Jones Newswires by telephone, Shatwan said, "Libya feels that the oil price cannot fall below $50/bbl (for U.S. benchmark crude oil West Texas Intermediate)."
Shatwan's comments follow Saudi Arabia's Ali Naimi saying Sunday that he sees no reason for OPEC to cut output this year.
Regardless of Monday's retreat Iran's standoff with the West over its nuclear ambitions is likely to prevent any major selldown, brokers said.
The 35-nation board of the International Atomic Energy Agency meets Thursday in Vienna to discuss the possibility of referring Iran to the U.N. Security Council over its uranium enrichment program.
"Fears of retaliatory action by Iran has fueled concerns over near-term security of supply. Clearly, this is just speculation at this point - but against a backdrop of limited spare capacity, the impact on oil prices is tangible nevertheless," said an analyst in London..
Mike Wittner, global head of research at Calyon in London, expects the tension over Iran's nuclear program to continue all year, and the investment influx of fresh money should also continue. As a result Wittner raised his average Nymex crude forecast for 2006 by $5 to $63/bbl.
-By Tim Falconer, Dow Jones Newswires; +44 (0) 207-842- 9449; tim.falconer@dowjones.com
(END) Dow Jones Newswires
01-30-06 0648ET
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