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Crude oil above 61 dollars amid concerns on US demand, Iran
AFP
NEW YORK
Petroleumworld.com 02 27 06Oil prices pushed higher Monday as traders tracked concerns over crude producer Iran and monitored weather forecasts in the United States for indications of demand for heating oil.
New York's main oil futures contract, light sweet crude for delivery in April, advanced 25 cents to close at 61.39 dollars per barrel.
In London, the price of Brent North Sea crude for April delivery rose 45 cents to settle at 61.33 dollars per barrel.
Prices gained amid a meeting in London of the six world powers working together on how to curb Iran's nuclear program.
The six world powers, the United States, Britain, China, France, Germany and Russia, have started drawing up a new draft UN Security Council resolution, a British Foreign Office official said.
John Sawers, who chaired the meeting, described it as "productive" and said there would be further contacts between the diplomats on the draft later this week. The US State Department said further contacts would occur by telephone on Thursday.
Oil market buyers are concerned that if the international community decides to punish Iran with economic sanctions, the country might decide to disrupt its crucial oil exports.
"With Iran and Western leaders far apart on a possible resolution, there is concern over retaliation Iran could possibly execute if the Security Council broadens sanctions," said Mike Fitzpatrick at Fimat USA.
"Still, Iran desperately needs its oil income and so concerns Iran will cut off oil exports as a backlash to sanctions is probably overblown."
Price support earlier Monday also came from predictions of cold weather in the United States.
Accuweather, a private forecaster, is predicting below normal temperatures for a large section of United States' northeastern region for the next 11-15 days.
The US northeast is traditionally a huge consumer of heating fuel during cold weather.
But Fitzpatrick said the market's focus "has shifted from heating oil to gasoline as participants anticipate peak summer motor fuel demand and winter's last gasp passes."
Crude futures had vaulted above 61 dollars last week for the first time in 2007, with gains underpinned by weak US stocks of gasoline or petrol, and simmering geopolitical tensions in crude producers Nigeria and Iran.
AFP 26 2113 GMT 02 07
Copyright© 1999 AFP. All Rights Reserved.
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