Thursday, Jan. 23, 1986 : Crude Oil Futures Decline

Crude oil futures prices closed below the $20-a-barrel psychological barrier Thursday, but analysts said a midday rally may prove to have been the turning point of a two-week decline.

Contracts for delivery in March and April settled lower, but other deliveries were higher. Most heating oil prices also advanced.

Trading opened sharply lower, down the $1 daily limit at the New York Mercantile Exchange, responding to remarks attributed to Saudi Arabian Oil Minister Ahmed Zaki Yamani that prices could fall below $15 a barrel.

At one point, crude oil for delivery in March was $18.60, but rebounded on good trade buying and settled at $19.82, off 57 cents from Wednesday and the first time the market closed below $20.

“That might look like it’s sharply down from last night on top of the terrible beating the market’s been taking, but actually it represents a very nice bounce off the low of the day,” said Charles T. Maxwell, an analyst in New York with Cyrus J. Lawrence, Inc.

“I think we’re ready for a pretty sharp rally,” he said.