Wednesday 18 January 2012

Oil prices rise


Oil Rises to Three-Day High as Saudi Arabia Is Seen Targeting $100 Crude

18 january, 2012

Oil rose to the highest level in three days on speculation that China will intensify monetary stimulus, supporting fuel demand, and as France pushed for a ban on Iranian imports.

France wants a European Union embargo delayed by no more than three months as members seek alternative supplies, an official with knowledge of the matter said yesterday. China’s economy expanded at the slowest pace in 10 quarters, sustaining pressure on Premier Wen Jiabao to ease monetary policy. Saudi Arabia aims to stabilize the average of crude prices worldwide at $100 a barrel in 2012, Oil Minister Ali al-Naimi said in an interview with CNN yesterday.

“Everything is rising because of China,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “It’s general market sentiment.”

Crude for February delivery rose as high as $101.01 a barrel in electronic trading on the New York Mercantile Exchange, up $2.31 from the Jan. 13 closing price, and traded at $100.73 at 1:08 p.m. London time. Floor trading was shut yesterday for the Martin Luther King Jr. holiday and electronic transactions will be booked with today’s for settlement purposes.

Brent oil for March on the London-based ICE Futures Europe exchange gained as much 1.3 percent to $112.76 a barrel. The European benchmark contract was at an $11.61 premium to New York-traded West Texas Intermediate grade for the same month. The front-month spread was a record $27.88 on Oct. 14.

European Embargo

France is seeking a shorter exemption for crude contracts with Iran even as other EU members favor a six-month delay, according to a second official, who also asked not to be identified because the talks are confidential.

EU foreign ministers are scheduled to decide at a Jan. 23 meeting on the ban, which will probably include an exemption for Eni SpA, Italy’s largest oil company. An embargo requires unanimous approval by the bloc’s 27 states.

Iran, OPEC’s second-largest producer, has threatened to block oil shipments through the Strait of Hormuz in retaliation against international sanctions.

“The embargo story is certainly not going away,” said David Lennox, an analyst at Fat Prophets in Sydney who forecasts U.S. crude will average $110 a barrel this year. “The Saudis came out and said they were looking to target oil at about $100 a barrel. I suspect that’s what the driver has been.”

Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries, can make up for any loss of crude output if sanctions are placed on Iran, al-Naimi told CNN. The minister doesn’t expect the Strait of Hormuz to be shut for an extended period of time. The waterway is a transit route for about a fifth of global oil trade, according to the U.S. Energy Department.

Emergency Supplies

The International Energy Agency will release oil stockpiles only in the event of a “serious” supply disruption, according to Maria van der Hoeven, executive director at the adviser to developed nations. The Paris-based agency is examining which countries have extra production capacity, she said yesterday in Abu Dhabi. It is due to release its monthly report tomorrow.

Oil’s gains were curbed after Nigerian labor unions suspended strikes and protests following President Goodluck Jonathan’s decision to limit gasoline-price increases. The country is an OPEC member and Africa’s largest oil producer.

China’s refineries boosted crude processing to a record in December because of a domestic diesel shortage, data from the National Bureau of Statistics in Beijing showed today. The country is the second-biggest oil consumer after the U.S. Its economy expanded 8.9 percent in the fourth quarter from a year earlier, beating the median 8.7 percent estimate of 26 economists surveyed by Bloomberg News.

2 comments:

  1. Hi,

    This blog is very informative for Historical Oil Price Data related information here I got it crisp information as I was looking last so many times. But now I am satisfied with this blog 100% and will suggest to everyone to read this one with keen intrest.

    Thank's & Regards

    ReplyDelete
    Replies
    1. Thank you for your comments - and for your tip.

      Delete

Note: only a member of this blog may post a comment.