Crude Oil Touches $117, While Gold Pulls Back

COMMODITIES

Crude Oil Touches $117, While Gold Pulls Back

By GREGORY MEYER
April 19, 2008; Page B4

Crude-oil futures touched $117 a barrel and ended at their fourth record in five sessions Friday after a flurry of buying instigated by supply worries.
Light, sweet crude for May delivery gained $1.83, or 1.6%, to settle at $116.69 a barrel on the New York Mercantile Exchange and rose as high as $117 a barrel after floor trading closed.
Oil markets were rattled by a pipeline leak in Nigeria, a major exporter of a high-quality crude blend similar to that delivered against the Nymex benchmark. A spokesman for Royal Dutch Shell PLC, part of a joint venture that operates the line, said the damage appeared to have been caused by explosives, and a "small quantity" of production was shut down for repairs.
Though involving a tiny amount of the world's crude flow, the leak was the latest reminder of the instability that has plagued supply from Africa's largest oil producer. "It just goes to show the geopolitical tensions still exist," said Nauman Barakat, senior vice president at Macquarie Futures USA in New York.
Many market participants said the day's swing reflected a bias toward buying into declines since recent selloffs have proven ephemeral. "Every time it dips, the buyers come back in, and before you know it, you're making new highs," said Tom Bentz, a broker and analyst at BNP Paribas Commodity Futures.
In other commodity markets:
GOLD: Prices on the Comex division of Nymex fell as strength in the dollar and the stock market prompted heavy selling. The nearby April gold contract fell $27.60 to $912.20 a troy ounce, while most-active June gold slid $27.70 to $915.20.
CATTLE: Prices on the Chicago Mercantile Exchange slipped despite news that U.S. beef would resume flowing to South Korea in mid-May. Market participants said the U.S.-South Korean trade deal is positive for prices, but traders booked profits ahead of the weekend. April cattle futures fell 0.77 cent to 89.55 cents a pound.