Oil dips, still above $80

23 February 2010

Written by John King

Crude oil prices moved lower this morning (February 23rd) but held above $80 (£51) a barrel after strong gains yesterday.

Heating oil prices also moved lower and were trading around the $2.07-a-gallon mark as European markets opened.

Prices climbed yesterday amid fears that a strike organised by French refinery workers sparked panic that Europe would witness an imminent fuel shortage.

Such concerns were abating slightly this morning ahead of a meeting to end the dispute, although a fall in the value of the dollar offset this as hard assets became more attractive to foreign traders.

"The impact of the strikes will probably not be too big because refinery utilization is still low, so I assume that others will step in and increase their production if this is an issue that lasts longer," said Stefan Graber, a commodities analyst with Credit Suisse in Singapore, speaking to Reuters.

He added that demand for crude, heating oil, driving fuels and other products remains precipitously low in the US.

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