Crude oil price on a rollercoaster Jane Padgham, Evening Standard 23 October 2000

Oil dealers endured a rollercoaster ride today, unable to decide whether to focus on escalating tensions in the Middle East or the prospect of Opec releasing more oil into the market next week.

North Sea Brent crude futures* jumped 48 cents to $32.10 a barrel as trading opened, before plunging as low as $31.40, down 22 cents on the day. By lunchtime they were nestling near Friday's closing level of $31.62.

The early rally was put down to Israeli Prime Minister Ehud Barak's decision to suspend the peace process with the Palestinians following an emergency summit in Cairo at the weekend. Palestinian leader Yasser Arafat said anyone blocking his people's path to an independent State could 'go to hell'.

But with tensions in the Middle East showing no sign of abating, pressure is mounting on Opec to honour its self-imposed price band mechanism, which would trigger the release of an extra 500,000 barrels a day next Monday, barring a slump in the price this week. Under the mechanism more oil must be pumped if the price remains above $28 for 20 consecutive trading days.

B On foreign exchanges, the euro slipped to 83.75 cents, just half a cent away from record lows plumbed last week. But intervention jitters ahead of tomorrow's meeting of finance officials from the Group of 20 developed and emerging economies prevented euro bears from driving the currency lower.

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-- Martin Thompson (mthom1927@aol.com), October 23, 2000