Opec chief expects oil price to dip further

Jakarta, Oct 29 | Updated: Oct 30 2004, 05:30am hrs
Opec president Purnomo Yusgiantoro said on Friday he expected global oil prices to fall further as crude stocks in the United States rose and supplies from the US Gulf of Mexico returned to normal.

US light crude futures slipped for a third day on Friday to a 3-1/2-week low of around $50.47 a barrel after a big increase in US crude inventories that eased concern over winter supplies.

At the moment the supply of oil from the Gulf of Mexico is returning back to normal. Secondly, there is increasing stocks in the US. Thats the reason the price is declining and that is good, said Purnomo, who is also the Indonesian oil minister. I expect oil price to continue falling.

The US government Energy Information Administration (EIA) data showed crude oil inventories in the worlds biggest energy consumer rose 4 million barrels for the week ended October 22, narrowing the supply deficit compared with a year earlier. US distillate supplies, including heating oil and diesel, are running about 12 percent below year-ago levels and have been slow to rebound due to strong trucking demand and disruptions to energy operations in the Gulf of Mexico after Hurricane Ivan.

But oil production in the Gulf was making a steady return and was at 80.47% of its normal rate of 1.7 million barrels per day, as producers repair infrastructure damaged by Hurricane Ivan, the US Minerals Management Service said on Thursday.