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COPYRIGHT 2008 Argus Media Inc.
Global crude prices have slumped on forecasts of weaker demand growth, but Hurricane Ike has sent US prompt gasoline prices surging.
The US faces the likelihood of crude falling below $100/bl as gasoline soars above $4/USG, taking refining margins off the charts. US benchmark crude WTI dropped by $7.02/bl to $100.87/bl in the week to 11 September, while North Sea Dated was down by $7.17/bl to $96.21/bl and Asian marker Dubai lost $7.30/bl to end at $94.83/bl.
The downturn came despite a pledge by Opec members "to strictly comply" with September 2007 output allocations, which implies a cut in actual Opec output of about 500,000 b/d. The near total shut-in of 1.3mn b/d of US Gulf offshore crude production by Hurricanes Gustav and Ike was another ostensibly bullish factor. US crude inventories fell by 5.9mn bl in the week to 5 September, to 21.3mn bl below a year earlier and well below the five-year average. But...
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