Oil falls as traders cash in

31 December 2007

Crude oil prices fell slightly on Friday as traders looked to cash in on the gains of the previous four days.

Analysts had predicted that prices would continue to rise following the news that stockpiles of oil in the US fell for a sixth consecutive week.

However, the price of US crude for February delivery fell 62 cents to settle at $96 (£48.10) a barrel and Brent crude slipped 90 cents to close at $93.88.

Many market commentators still believe prices will climb to record highs in the near future and Gene McGillian of TFS Energy Futures told Dow Jones Newswires that Friday's fall had been nothing more than "weekend profit taking".

There were some dissenting voices, however, after a report by MDA Federal Inc's EarthSat Energy Weather suggested that temperatures in the US would be substantially higher than normal next month.

Phil Flynn of Alaron Trading told Bloomberg: "It looks like it's really going to warm up substantially in January. That will take some of the pressure off the tight heating oil supplies."