Business | Oil & Gas
Oil price rises after Iran fears
Oil leapt $5 to a new record high above $147 a barrel on Friday, spurred by growing worries of threats to supplies from Iran and Nigeria.
- Reuters
- Published: 12:46 July 11, 2008
- Image Credit: Gulf News Archive
- Oil trading has become very volatile, with geopolitical events becoming critical supply-related drivers.
London: Oil leapt $5 to a new record high above $147 a barrel on Friday, spurred by growing worries of threats to supplies from Iran and Nigeria and the possibility of a strike by Brazilian oil workers next week.
US crude was $4.11 at $145.76 a barrel by 1515 GMT, off highs of $147.27, taking gains in just two sessions to over $10. It rose $5.60 or four per cent a barrel on Thursday in a late burst of buying activity. London Brent crude was up $3.77 at $145.80 a barrel.
Leading the oil complex was ICE gas oil futures which climbed to a new record high of $1,336.75 a tonne amid strong demand for diesel and aviation fuel.
Analysts said the threat of supply disruptions provided the bullish backdrop, as the demand picture was unlikely to change much until after the Beijing Olympics.
"We continue to believe that the downside risk to oil prices remains relatively low until the non-OECD countries begin to show greater price and income elasticity response than has been evident to date," Deutsche Bank analyst Adam Sieminski said.
Oil, which had been on the retreat for much of the week, reversed course on Thursday as fears resurfaced of supply disruptions from potential hot spots, Opec members Iran and Nigeria.
Investors have also flocked to oil and other commodities this year as a hedge against rising inflation and a weak dollar.
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