World oil prices slumped this evening as traders bet on a swift US-led victory over Iraq, shrugging off reports of oil well fires as war got underway.
New York's light sweet crude contract for April delivery slumped $1.27 to $28.61 a barrel.
London's benchmark Brent North Sea crude oil for May delivery tumbled $1.25 to $25.50.
Prices briefly spiked after Defense Secretary Donald Rumsfeld said Iraqi forces may have set three or four oil wells on fire in the massive petroleum fields of southern Iraq.
"I have seen indications and reports from people that the Iraqi regime may have set fire to as many as three or four of the oil wells in the south," he told a news conference.
Rumsfeld said he was still trying to get official information on the wells, which lie in the Rumaila fields where about 1.2 million barrels a day - or two-thirds of total Iraqi production - is pumped.
But when major television networks such as Fox, CNN and MSNBC began showing pictures of the devastating hits on Baghdad, oil traders put their money behind the US forces.
US Energy Secretary Spencer Abraham said the extent of damage to the Iraqi oil fields was unknown, but that world supplies including emergency stocks were ample.
