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Last Updated: Tuesday, 2 August 2005, 09:32 GMT 10:32 UK
Oil prices slip from record high
Oil refinery in Kuwait
Oil prices eased slightly on Tuesday but the market is still jittery
Oil prices have slipped back from record levels of more than $62 a barrel sparked by the death of King Fahd of Saudi Arabia on Monday.

US light sweet crude eased to $61.41 in Asian trade, after hitting $62.30 in New York on Monday on fears of instability in Saudi Arabia.

King Fahd's death is unlikely to change Saudi oil policy, but traders have long-term worries about the succession.

Concerns over Iran's nuclear ambitions also bolstered oil prices.

Saudi succession

Iran, the second largest oil exporter within the Opec producers cartel, is at loggerheads with the US over plans to resume the processing of uranium.

The oil industry's benchmark Brent crude slipped slightly to $60.35 from Monday's closing price of $60.44 on Tuesday morning in London.

Analysts said concerns over the Saudi royal succession, tensions over Iran and US refinery outages continue to overshadow the market.

Man kissing TV screen showing King Fahd after announcement of his death

King Fahd, Saudi Arabia's ruler since 1982, died on Monday at the age of 84.

Crown Prince Abdullah is set to succeed him, but as he is also an octogenarian dealers are worried about the longer-term outlook for Saudi Arabia, which has a quarter of the world's oil reserves.

The new monarch has vowed to stick to Saudi's long-standing oil policy, which aims to keep the markets well supplied.

"The question is who will follow them," said Jane Collin, an analyst at Energyintel.

"The potential for bitter infighting is already triggering concern about future stability in the oil-rich region."

Nuclear issue

Fears about a further decline in relations between the US and Iran is also affecting the market.

The US is opposed to Iran's plan to resume uranium processing, which Iran claims is necessary for its domestic energy needs.

Iran produces about four million barrels of oil a day, making a vital source of supply for major energy consuming nations.


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