Oil
prices surge after Saudi attack
By
Julie Charpentrat
AFP
NEW
YORK
Petroleumworld.com
02 26 06
Oil prices spiked on world markets Friday as an attempted suicide
car bomb attack against a major Saudi oil facility reignited supply
concerns.
Saudi Oil Minister Ali al-Nuaimi said that output from the world's
number one producer was unaffected by a foiled "terrorist"
attack against a processing plant in the oil-rich Eastern Province.
At least two would-be attackers were killed when they were stopped
by security forces, oil sources said.
Still, the uncertainty added support to prices, which were already
surging on supply concerns over Nigeria, Iran and Iraq.
New York's main contract, light sweet crude for delivery in April,
soared 2.37 dollars to 62.91 dollars per barrel in closing trading
after spiking as high as 63.25 dollars.
In London, the price of Brent North Sea crude for April delivery
gained 2.06 dollars to end at 62.60 dollars per barrel.
James Williams at WTRG Energy said the market was especially sensitive
to the Saudi incident.
"Since Saudi Arabia is the only source of spare capacity,
any damage to this facility would have a larger impact than a
similar event in another country," he said.
Bill O'Grady at AG Edwards added that the attack "clearly
signals that Al-Qaeda is concentrating on oil, and not the government."
Fimat analyst Mike Fitzpatrick said the Saudi incident added to
jitters stemming from religious strife in Nigeria and concerns
about Iraq and Iran.
"Obviously, this has to heighten awareness of the increasing
danger in that part of the world," he said.
Prices had fallen Thursday on data that had revealed healthy stockpiles
of US energy.
However concerns about output cuts in Nigeria, Africa's biggest
oil producer, resurfaced on Friday.
Last weekend separatist guerrillas in Nigeria attacked the country's
Forcados oil terminal run by energy giant Royal Dutch Shell.
Analysts say that tension over Iran's nuclear program could lead
to disruption of the country's oil exports.
Diplomats told AFP on Friday that Iran was now operating a 10-centrifuge
cascade in a step forward in uranium enrichment, despite Western
fears it is seeking atom bombs.
A senior UN nuclear inspector was meanwhile heading for Tehran
Saturday for talks days before a pivotal report on Iran's nuclear
activities.
The incident in Saudi Arabia was the first known attempted attack
on an oil installation in the world's top crude exporter, which
has been battling a wave of violence by suspected Al-Qaeda militants
since May 2003.
A Saudi security expert said last September that the kingdom,
which sits on a quarter of global oil reserves, had boosted spending
on the protection of its oil industry to as much as 1.5 billion
dollars per year.
Saudi Arabia currently pumps around 9.5 million barrels of oil
per day and has an output capacity of 11 million bpd.
AFP
02 24 06
Copyright
© 2006 AFP. All rights reserved
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