Total Pageviews

Tuesday, June 16, 2009

Oil prices jump on Iran unrest

Oil prices jump on Iran unrest
7 hours ago
LONDON (AFP) — Oil prices rose back above 71 dollars on Tuesday owing to a weaker dollar and political unrest in key crude producers Iran and Nigeria, analysts said.
New York's main futures contract, light sweet crude for delivery in July, gained 1.20 dollars to 71.82 dollars a barrel.
Brent North Sea crude for August climbed 1.32 dollars to 71.56 dollars. The July contract expired on Monday.
Prices advanced as the European single currency jumped against the dollar on news that investor confidence in the German economy rose for an eighth month running.
A struggling dollar tends to boost demand for dollar-priced crude as the commodity becomes cheaper for buyers holding stronger currencies.
"It is still important to keep watching out for the dollar," said analyst Andrey Kryuchenkov at VTB Capital in London.
"For now ... (the oil market) could remain quiet until Wednesday afternoon when US energy data is released," he added.
The weekly report on US energy reserves is a key factor because the United States is the biggest oil consuming nation, followed by China.
Meanwhile unrest in Iran and Nigeria remained key focus points for traders, according to Commerzbank commodities analyst Eugen Weinberg.
"In addition to China's oil appetite, coupled with ... a weaker US dollar, the geopolitical risks are the underlying drivers," Weinberg said.
"Political unrest following the presidential elections in Iran and bombing attacks on oil plants in Nigeria represent an explosive mix for the oil market."
Iran's election watchdog said on Tuesday it was ready for a recount in the hotly disputed presidential vote as the nation braced for further protests after seven people were killed in street battles.
The Islamic republic is the second biggest crude oil producer in the Organization of Petroleum Exporting Countries (OPEC) after kingpin Saudi Arabia.
The stage was set for possible further confrontations as President Mahmoud Ahmadinejad's camp and supporters of defeated rival Mir Hossein Mousavi both called for rallies in the biggest outpouring of public anger since the 1979 Islamic revolution.
Meanwhile, tensions remained high in Nigeria after militants in the Niger Delta had on Monday claimed attacks against facilities run by US oil giant Chevron.
The Movement for the Emancipation of the Niger Delta (MEND) also threatened to extend its operations beyond Delta State to others in the oil-rich but volatile southern region.
Oil prices had fallen sharply on Monday as the dollar strengthened and traders took profits from recent gains.

No comments: