- The Washington Times - Tuesday, September 25, 2001

NEW YORK (AP) Energy futures tumbled yesterday amid worries that a dramatic slowdown in the global economy will lessen demand for crude oil and other products.
November crude prices fell $3.96 per barrel to $22.01 on the New York Mercantile Exchange, while natural gas prices fell below $2 for the first time since March 1999.
Gasoline "buyers are saying 'we only need 75 percent to 80 percent'" of normal levels for this time of year, said Ed Silliere of Energy Merchant LLC. Gasoline is refined from crude oil.
As for natural gas, the price continues to fall amid growing supplies at a time when demand remains weak among manufacturers and power generators.
Producers of natural gas drilled frenetically earlier in the year to cash in on high prices. But once demand began to dry up, the market became flooded.
The decline in energy prices came as Organization of the Petroleum Exporting Countries' oil ministers readied to meet in Vienna, Austria, this week to review their crude production quotas.
As suppliers of almost 40 percent of the world's oil, members of the OPEC have the power to help shore up the buckling global economy or speed its descent into recession.
Stakes are high for tomorrow's meeting. In the wake of the Sept. 11 attacks on New York and Washington, some analysts believe OPEC members might discuss reversing this month's cut in output of 1 million barrels a day though the cartel is likely just to renew its existing quotas.
"OPEC doesn't need to do anything. What OPEC should avoid doing now is to cut production to get prices back up again. If they did, they would make a recession worse," said Leo Drollas, chief economist of the Center for Global Energy Studies in London.
OPEC has a production target of 23.2 million barrels a day, after having slashed its official production this year by a total of 3.5 million barrels a day in an effort to keep prices firm.
In the wake of this month's terror attacks, the United States, the world's most voracious oil importer, is leaning on OPEC to keep prices and supplies stable.
Oil prices initially spiked to more than $31 a barrel after hijacked airliners plowed into the World Trade Center and Pentagon. Prices have eased since then as concerns about shriveling corporate profits and massive job cuts foretold a drop in demand for oil.
Energy products were lower across the board. Heating oil for delivery in October was off 9.81 cents to 61.06 cents per gallon; October unleaded gasoline was off 8.55 cents to 63.60 cents per gallon; and October natural gas was off 1.93 cents to $1.91 per 1,000 cubic feet.
November futures contracts of Europe's benchmark crude, North Sea Brent, was off $3.42 to $22.02 per barrel.
Energy prices usually rise in the autumn, as refiners in the Northern Hemisphere stock up to produce heating oil for winter.
However, a decline in the need for jet fuel as airlines curtail their flights due to lessened demand, has left the market temporarily flush with supply.
The decline in prices has only begun to spill over to the retail market.
The average price of gasoline Friday, including all grades and taxes, was $1.54 a gallon, down 2.29 cents since Sept. 7, according to the Lundberg Survey of 8,000 stations nationwide.

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