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Oil prices top 61 dollars on supply concerns
AFP
NEW YORK
Petroleumworld.com 02 26 06World oil prices vaulted above 61 dollars a barrel Friday to year-highs on news of a slide in reserves of US gasoline, with tensions in crude producers Iran and Nigeria also unnerving the market.
New York's main oil futures contract, light sweet crude for delivery in April, advanced 19 cents to close at 61.14 dollars a barrel. The contract came off 61.80 dollars, New York's highest level of the year.
In London, the price of Brent North Sea crude for April delivery climbed 26 cents to settle at 60.88 dollars a barrel, off a peak of 61.68 dollars.
As the year's second quarter approaches, demand for heating oil normally eases and the focus switches toward gasoline, with the US driving season beginning in May.
"Distillates are less important now, it's (the drop in) gasoline (stocks) that took the market's notice," Global Insight analyst Simon Wardell said in London.
Thursday's weekly inventory report from the US Department of Energy (DoE) showed that gasoline inventories fell by 3.1 million barrels last week to 222.1 million in the week ending February 16.
According to the government they remain well above the seasonal average, but Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures, pointed to rising demand for motor fuel.
"The demand level for gasoline is higher than last year. It's quite an important factor supporting the (price) gains," Tokyo-based Emori said.
The DoE also said that US crude oil reserves had surged by 3.7 million barrels to 327.6 million barrels last week.
Analysts had predicted a gain in crude of just 1.3 million barrels.
And the report showed that distillates, which include heating oil, fell 5.0 million barrels to 128.3 million as a cold spell gripped the United States.
Another boost to oil prices came from a report Thursday by the International Atomic Energy Agency, which declared that Iran, one of the world's biggest producers of crude, had failed to suspend uranium fuel enrichment as demanded by the United Nations.
Oil traders were also tracking fresh unrest in Nigeria, Africa's biggest producer of crude.
Nigerian armed militants Friday stepped up violent attacks on foreigners, killing a Lebanese man, while two Italians were kidnapped in the oil-rich Niger delta, police and industry sources said.
AFP 24 0209 GMT 02 07
Copyright© 1999 AFP. All Rights Reserved.
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