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Oil prices drop as U.S. says Bin Laden killed

Oil&Gas Materials 2 May 2011 11:59
Oil dropped the most in two weeks in New York after President Barack Obama said al-Qaeda leader Osama bin Laden had been killed, stoking speculation that the risk of Middle East supply disruptions will ease, Bloomberg reported
Oil prices drop as U.S. says Bin Laden killed

Azerbaijan, Baku, May 2 / Trend /

Oil dropped the most in two weeks in New York after President Barack Obama said al-Qaeda leader Osama bin Laden had been killed, stoking speculation that the risk of Middle East supply disruptions will ease, Bloomberg reported.

Futures fell as much as 1.5 percent after the first reports that bin Laden, who orchestrated the Sept. 11 attacks on New York and Washington, was dead. Obama confirmed the Al-Qaeda leader died during a firefight in Abbottabad, Pakistan. Oil slipped earlier on signs China's economic growth may moderate, tempering fuel demand in the world's second biggest crude user.

"The elimination of someone like Osama could be a bearish driver because it could alleviate the contagion fears in the Middle East," said Stephen Schork, president of market consultants The Schork Group Inc. in Villanova, Pennsylvania. "The market has been waiting for news to move in a significant way in either direction. Now we have a headline that could clear the path for a significant correction lower."

Crude for June delivery slipped as much as $1.72 to $112.21 a barrel in electronic trading on the New York Mercantile Exchange, and was at $112.63 at 1:38 p.m. Singapore time. The contract rose $1.07, or 1 percent, to $113.93 on April 29, the highest settlement since Sept. 29, 2008.

Oil prices have climbed 23 percent this year as revolts that overthrew the governments in Tunisia and Egypt raised concern that supplies from the Middle East would be disrupted as the protests spread. Fighting between rebels and forces loyal to Libyan leader Muammar Qaddafi has shut 1.3 million barrels a day of output in Africa's third-largest producer.

Brent crude for June settlement slid $1.17, or 0.9 percent, to $124.72 a barrel on London's ICE Futures Europe exchange. The contract advanced 7.3 percent in April.

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