London, Nov 21: IPE oil futures crept steadily higher on last Friday to recover much of Thursday's steep sell-off. Strong fundamentals were said helping crude and products erase some of those technically driven losses. Front month January Brent was up 46 cents at $24.82 a barrel, recouping most of the 56-cent fall seen a day earlier. The January/February Brent spread was receiving some attention, with buying interest widening it out to above 70 cents, from a low of around 61 cents earlier in the day. December gas oil swung into positive territory, adding 50 cents to $210.75, compared to early losses of about four dollars.
``I think the products market in Europe is pretty strong, which is why we've turned positive on the gas oil, rather than following the negative bias," said one London-based broker. The December US light crude, which expires at the close of business on Friday, was 50 cents higher at $26.30 in out-of-hours ACCESS trade. The overall tone of the market was positive, with lingering concernsover falling stocks ahead of the northern hemisphere winter.
Those worries drove Brent to nine-year highs on Wednesday, when it traded at $25.09 a barrel and Thursday's late sell-off was seen as somewhat overdone, particularly on products. Resistance for Brent was seen in the low to mid $24.80s, and above that the $25 level would need strong momentum to break, if the upward march continued.
Forecasts of slightly warmer weather in the United States over the next week or so were seen likely to put a cap on the upward march on the crude and heating oil markets on NYMEX. But dealers said the main driver was likely to be action on the front month ahead of the December contract expiry.
Other influences cited on the market were the restart late on Thursday of the giant Hovensa refinery in the Caribbean, which was shut late on Tuesday as a precaution against hurricane Lenny. And OPEC President Abdullah al-Attiyah of Qatar said on Thursday that most OPEC countries supported an extension of the supply curbs thathave rallied prices beyond March of next year.
"Most OPEC countries approve the extension of the cuts, but for what period is up to the next meeting of OPEC," the Qatari Oil Minister told a press conference.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.