Oil Falls for a Second Day as BP Restarts Caspian Sea Pipeline

By Angela Macdonald-Smith and Christian Schmollinger

Aug. 25 (Bloomberg) -- Crude oil fell for a second day in New York as BP Plc restarted flows through a Caspian Sea pipeline.

The Baku-Tbilisi-Ceyhan pipeline, which moves oil from Azerbaijan through Georgia to Turkey's Mediterranean coast, may resume full operations within days after a fire halted exports, a BP spokeswoman said Aug. 23. Oil dropped 5.4 percent on Aug. 22, the most in percentage terms for more than three years.

``The pipeline restart was a contributing factor, putting more supply in the market,'' said Jonathan Barratt, managing director of Commodity Broking Services in Sydney. ``Oil is trading in a very volatile, wide range. The volatility is telling me that a base is trying to form'' and prices won't sink much further, he said.

Crude oil for October delivery declined as much as 56 cents, or 0.5 percent, to $114.03 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It traded at $114.12 at 9:08 a.m. in Singapore.

To contact the reporters on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net; Christian Schmollinger in Singapore at christian.s@bloomberg.net