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Last Updated: Tuesday, 9 November, 2004, 21:51 GMT
US oil output lowest since 1950
US oil refineries
Hurricane Ivan forced several refineries to close
US oil output has fallen to its lowest monthly level in more than 50 years in the wake of Hurricane Ivan.

Daily output fell below five million barrels in September for the first time since April 1950, according to new government estimates.

Hurricane Ivan disrupted drilling operations and pipelines in the Gulf of Mexico, with about 10m barrels lost.

The damage wrought by Ivan fuelled the spike in oil prices which topped $50 for the first time in early October.

Gradual decline

Ivan's impact is likely to be felt on production figures for October and November.

The US Energy Information Administration has revised downwards estimated output figures for both months.

About 400,000 barrels were lost per day in October while about 200,000 barrels per day still remain offline.

According to the agency's latest estimates, production totalled 4.996m barrels in September, the lowest figure since the 4.972m barrels produced in April 1950.

Ivan forced the closure of a host of refineries, accounting for about 13% of total US production.

"Crude oil production has been declining for several years," said the EIA's Doug McIntyre.

"When you add on the impact from Hurricane Ivan and the lost production, it is not too surprising that production has hit lows related to historical numbers."

Falling prices

In recent weeks, crude oil prices have fallen back from record highs set in October as concerns about disruptions to supply in Nigeria have eased and President Bush won a second term by a clear margin.

On Tuesday, a barrel of US light crude closed at $47.37, its lowest level in seven weeks.

The chief executive of Total, France's largest oil producer, has said he believes the price of oil could fall sharply next year.

"Major events aside, there is a strong possibility that the price will come down to about $30 next year," Thierry Desmarest told French newspaper Le Figaro in an interview to be published on Wednesday.

"Everything depends on Chinese growth and production outside Opec countries, in Africa, the Caspian Sea or Russia," he added.

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