Oil prices dip after IEA statement

Crude oil prices were lower after early gains Thursday as the International Energy Agency said it will release emergency reserves of oil if Tropical Storm Gustav regains hurricane status and damages Gulf of Mexico oil facilities.

Despite uncertainty about what path the storm will take, a number of oil companies have already begun to evacuate offshore facilities as a precaution.

After going above $120 per barrel, West Texas Intermediate crude for October delivery was down $2.60 to $115.55 per barrel at the close of floor trade on the New York Mercantile Exchange while Brent crude dropped $2.22 to $114 per barrel on the ICE Futures Europe exchange in London.

Earlier in the day, Nymex September gasoline dropped 7 cents to $3 per gallon and October heating oil fell 10 cents to $3.18 per gallon and October natural gas dropped 72 cents to $7.89 per million British thermal units on strong gains in US inventories.

Most base metals prices were lower.

December copper added 4 cents to $3.40 per pound in New York while three-month copper was down $120 to $7,535 per tonne after London Metal Exchange inventories added 2,200 tonnes to reach a six-month high and on worries that demand from China will not expand.

Aluminium prices fell $35 to $2,730 per tonne, while zinc was down $50 to $1,799 per tonne, tin fell $400 to $20,150 per tonne and nickel dropped $500 to $20,500 on concerns about demand.

Lead, however, added $10 to $2,040 per tonne after going as high as $2,125 per tonne earlier in the session.

Precious metals prices were up, with December gold adding $3.10 to $837.10 per troy ounce as silver was 14 cents higher to $13.71 per troy ounce and October platinum gained $43.50 to $1,484.20 per troy ounce.

Grains prices were lower on the Chicago Board of Trade, with December corn down 7 cents to $5.88 per bushel while September wheat fell 13 cents to $7.89 per bushel and November soybeans dropped 22 cents to $13.26 per bushel.

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