Oil prices rise amid geopolitical tension
Tuesday, 1 January 2008
SINGAPORE, Dec 31 (AFP): Oil prices rose today due to instability in Pakistan and on the Turkish border with Iraq, heading towards 100 dollars per barrel again on the last trading day of the year, dealers said.
In afternoon trade, New York's main contract, light sweet crude for February delivery, was 28 cents higher at 96.28 dollars per barrel.
The contract had briefly approached 98 dollars Friday, a one-month high, after the assassination of Pakistani opposition leader Benazir Bhutto, before falling back due to profit-taking.
Oil prices have roughly doubled in 2007 from a low point of just below 50 dollars in January, with some analysts predicting a price of 100 dollars or higher during 2008.
Dealers said a US report last week showing a higher-than- expected drop in US crude stockpiles had also supported prices, which are still within sight of the all-time record of 99.29 dollars per barrel reached in November.
Brent North Sea crude for February delivery was 27 cents higher at 94.15 dollars per barrel. It hit a one-month peak, 95.86 dollars, in London Friday before easing, and achieved its all-time high of 96.53 dollars in November.
Dealers said Bhutto's killing, which plunged Pakistan into crisis and sparked global condemnation, would have a psychological impact on the market even though the country is not an oil producer.
"Political unrest around the world has once again become a major factor," said David Johnson, an oil analyst with Macquarie Securities in Hong Kong.
Tension along Turkey's border with northern Iraq has added to concerns about geopolitical instability, Johnson said.
Turkey said Friday it would continue its military operations against members of the Kurdistan Workers' Party (PKK). The army says it has launched three cross-border bombing raids and killed more than 160 rebels since December 16.
Johnson said trading would be light, with dealers unwilling to make major decisions ahead of the New Year holiday Tuesday.
In afternoon trade, New York's main contract, light sweet crude for February delivery, was 28 cents higher at 96.28 dollars per barrel.
The contract had briefly approached 98 dollars Friday, a one-month high, after the assassination of Pakistani opposition leader Benazir Bhutto, before falling back due to profit-taking.
Oil prices have roughly doubled in 2007 from a low point of just below 50 dollars in January, with some analysts predicting a price of 100 dollars or higher during 2008.
Dealers said a US report last week showing a higher-than- expected drop in US crude stockpiles had also supported prices, which are still within sight of the all-time record of 99.29 dollars per barrel reached in November.
Brent North Sea crude for February delivery was 27 cents higher at 94.15 dollars per barrel. It hit a one-month peak, 95.86 dollars, in London Friday before easing, and achieved its all-time high of 96.53 dollars in November.
Dealers said Bhutto's killing, which plunged Pakistan into crisis and sparked global condemnation, would have a psychological impact on the market even though the country is not an oil producer.
"Political unrest around the world has once again become a major factor," said David Johnson, an oil analyst with Macquarie Securities in Hong Kong.
Tension along Turkey's border with northern Iraq has added to concerns about geopolitical instability, Johnson said.
Turkey said Friday it would continue its military operations against members of the Kurdistan Workers' Party (PKK). The army says it has launched three cross-border bombing raids and killed more than 160 rebels since December 16.
Johnson said trading would be light, with dealers unwilling to make major decisions ahead of the New Year holiday Tuesday.