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Oil prices take breather amid recession fears
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newsbyte on 09 June, 2008 01:11:40
 
World oil took a breather on Monday from spiralling prices seen hitting $150
which have prompted consumer nations to urge a production increase amid warnings
of a global recession.
New York's main oil futures contract, light sweet crude for July delivery,
eased $1.06 to $137.48 a barrel after making its biggest one-day jump ever on
Friday. The contract jumped $ 10.75 a barrel to close at a record $ 138.54.
Also on Friday in intraday trade the benchmark contract crossed $ 137, $ 138
and $ 139 for the first time and soared to an all-time high of $139.12.
Brent North Sea crude for July dropped $ 1.30 to $ 136.39 a barrel after
smashing barriers on Friday in London. Brent hit a new intraday high of $138.12
a barrel before it eased back to settle at a record $137.69, up $ 10.15. Both
futures contracts far exceeded their prior record highs set on May 22 - $ 135.09
in New York and $ 135.14 in London.
Crude oil leapt in reaction to a new decline in the US dollar after the
European Central Bank on Thursday signaled an interest rate hike and the US
reported a sharp rise in unemployment on Friday, analysts said.
Compounding the dollar squeeze were reported remarks about Iran's nuclear
programme by Israeli Deputy Prime Minister Shaul Mofaz. Analysts said the
comments fanned fears of a Middle East conflict.
Iran's representative to the OPEC oil cartel on Sunday warned the price of
crude oil is set to rise even further to $ 150 a barrel by the end of summer.
Eleven nations that guzzle nearly two-thirds of the world's energy called on
Sunday for an urgent hike in global oil production.