Oil prices eased today as fears of supply disruptions receded following a convincing referendum victory in Venezuela for President Hugo Chavez and after Russia's Yukos said it had received a government assurance on September exports.
Worries about US crude inventories, a continued disruption in Iraqi supplies and strong world fuel demand underpinned prices that remain $9 a barrel, 25 per cent, higher than at the end of June.
US light crude oil for September shed 29 cents to $45.76 a barrel after easing 50 cents on Monday. London Brent slipped 42 cents to $42.27 a barrel. Oil had set new all-time highs in all but one of the previous 12 trading sessions, peaking in Asia trade at $46.91 for US crude.
In real terms, adjusted for inflation, oil prices are still well below 1980s peak of $80 a barrel, following the Iranian revolution. But average US prices this year so far of $38 are approaching those of 1974, the first oil shock, when crude averaged an inflation-adjusted $43 during the Arab oil embargo.
Venezuelan leader Chavez easily won a referendum on his rule, raising hopes for an end to more than two years of confrontation with opposition leaders who organised a lengthy oil industry strike in late 2002 and early 2003.
Although concerns linger about supplies from Yukos, Russia's top oil producer, hopes are that its exports will escape disruption. Yesterday, Yukos chairman Mr Viktor Gerashchenko said the company had been assured by the authorities it would be allowed to produce and sell oil at least until the end of September.
Yukos is trying to fend off bankruptcy as bailiffs pursue payment of multi-billion-dollar tax arrears.