Energy futures prices slumped again Monday on word that there may be even more surplus oil flowing to market than previously believed. Gasoline and heating oil futures retreated sharply and crude oil also was lower at the New York Mercantile Exchange.
"The market was undermined by a report in Petroleum Intelligence Weekly that OPEC has increased production to 19 million barrels a day," said Andrew Lebow, an analyst in New York with Shearson Lehman Bros. This would be the highest level of production in 2 1/2 years for the Organization of Petroleum Exporting Countries, he said, and comes at a time when many producers are trying to find a way to limit output and raise prices.
OPEC's production has been pegged by the International Energy Agency at 17.3 milllion barrels a day.
Futures prices rebounded a bit last week, "but traders were skeptical" of the improvement, Lebow said. With the report on OPEC production, he said, "they cashed in on that skepticism."
Platinum futures went into a steep decline, pulling gold and silver along, as traders took profits on deals they had made on the possiblity of unrest in South Africa.