| Yukos stops sales oil hits 21 year high Original Source Link: (May no longer be active) http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=5800408http://www.reuters.com/newsArticle.jhtml?type=businessNews&storyID=5800408
Oil Hits 21-Year High, YUKOS to Stop Sales Wed Jul 28, 2004 10:27 AM ET By Andrew Mitchell
LONDON (Reuters) - Oil prices hit a fresh 21-year high on Wednesday after bailiffs ordered beleaguered Russian oil giant YUKOS to stop sales, threatening further strain on tight international supplies.
The news intensified concerns over the lack of spare capacity in the international oil system, as the OPEC cartel pumps at its highest level for a quarter of a century to meet strong global demand growth.
U.S. light crude rose 66 cents to a new high of $42.50 a barrel -- just above peaks hit in early June and the highest price since the New York Mercantile Exchange launched the contract in 1983. London Brent crude rose 53 cents to $39.07 a barrel.
Prices jumped after a company source said Russian bailiffs told YUKOS' four production units, which together pump 1.7 million barrels a day of oil, to halt sales of property -- including oil.
YUKOS said it had not complied with the order and was continuing to operate while it sought clarification of what chief executive Steven Theede called a "misinterpretation."
YUKOS has said it faces imminent bankruptcy as courts seek to enforce a $3.4 billion tax debt for 2000.
A halt to sales would hasten the collapse of the company, which pumps around 20 percent of Russian crude supply. Russia is the world's second biggest oil exporter behind Saudi Arabia after five years of rapid production growth.
Theede has asked for access to YUKOS frozen bank accounts to avoid a production halt later this week.
STRETCHED TO THE LIMIT
If the YUKOS turmoil prevents Russian production from meeting forecasts for further growth, the global oil supply system will be even more pressed to meet rising demand, analysts say.
OPEC has already jacked up production to 30 million barrels per day -- the highest level since 1979 -- to meet breakneck consumption growth in China and the United States.
Saudi Arabia has led the supply increase, eager to stop prices rising to a level that would hurt world economic growth and stunt fuel demand.
OPEC President Purnomo Yusgiantoro of Indonesia said that the cartel was doing its best to get prices down. "We are very sincere about pushing the price to be stable below $30 per barrel," he told Reuters.
But Venezuela's oil minister said OPEC had little spare capacity to help lower prices. "Most of the countries are near their production limits," Rafael Ramirez told Reuters.
Traders are focused on Wednesday's weekly data on fuel stockpiles from the U.S. Energy Information Agency, with analysts polled by Reuters expecting crude stocks to have slipped by 900,000 barrels in the week ended July 23.
Gasoline stocks are expected to dip just 150,000 barrels, while distillates, which include heating oil, are seen rising by 600,000 barrels. The data is due out at 1430 GMT.
|
|