Mild Weather Increases U.S. Oil Inventories
Oil prices have reached their lowest in a month at $45 thanks to mild weather increasing U.S. inventories.
“The upside is limited by the fact there is some spare capacity in the system unlike late last year,” said commodities strategist, David Thurtell.
“We’ve passed the critical point leading up to the northern hemisphere winter. U.S. stocks of gasoline and crude are pretty strong and demand growth will probably moderate in 2005.”
A BBC article points out that, “Oil prices have been coming down since late January as weather in the US has moderated, following a surge to nearly $50 on worries of renewed demand.
Fears that oil cartel Opec may call for output cuts had also boosted prices.”
OPEC’s quotas are 10% higher than they were a year ago.
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