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Mideast tensions send oil to record highs { September 2007 } Original Source Link: (May no longer be active)
http://apnews.myway.com/article/20071026/D8SGT2PO0.htmlhttp://apnews.myway.com/article/20071026/D8SGT2PO0.html
Oil Briefly Spikes Above $92 a Barrel
Oct 26, 7:35 AM (ET)
By THOMAS HOGUE
BANGKOK, Thailand (AP) - Crude oil prices spiked above $92 in Asia Friday on growing tensions in the Middle East and renewed concern about oil supplies.
The United States announced new sanctions against Iran Thursday, targeting the elite Revolutionary Guards, which Washington accused of backing Shiite militants in Iraq. A confrontation between the world's largest oil consumer and its fourth largest oil producer could upend markets.
Lebanese troops fired on Israeli warplanes Thursday, and while a conflict between Israel and Lebanon would not directly affect oil supplies, traders have become increasingly concerned that any conflict in the Middle East would envelop Saudi Arabia and Iran.
Parallel to fears of a broader conflict in the Middle East were new oil supply concerns.
"The market is really quite worried about supply," said Tetsu Emori, commodity markets fund manager at ASTMAX Futures Co. in Tokyo. "Oil is quite imbalanced. It is quite tight."
Light, sweet crude for December delivery rose $1.07 to $91.53 a barrel in electronic trade on the New York Mercantile Exchange in Singapore. It briefly rose to a new trading record of $92.22 during Asian trading.
The Nymex crude contract jumped $3.36 to settle at $90.46 a barrel Thursday in the U.S., closing above $90 a barrel for the first time.
The combination of supply worries and geopolitical concerns has pushed crude oil prices up more than 7 percent since Tuesday.
"It's the low level of the crude level in the U.S., tensions between Iraq and Turkey and the sanctions from the U.S. on Iran," Emori said.
Prices jumped sharply Wednesday after the Energy Information Administration reported oil inventories had fallen 5.3 million barrels last week when analysts had expected growth of 300,000 barrels.
That report reversed a three-day downward price trend, and put energy traders back in a bullish mood, analysts said.
On Thursday, Organization of Petroleum Exporting Countries Secretary General Abdalla el-Badri told The Wall Street Journal Asia that the cartel is not talking about boosting production by 500,000 barrels. Those comments countered rumors that Saudi Arabia is pushing for another production increase after pressuring the group into one of similar size earlier. That boost goes into effect Nov. 1.
And while U.S. crude stocks fell to a nine-month low last week, Dow Jones Newswires reported that Oil Movements, a company that tracks oil tanker traffic, said the extra crude shipments from OPEC members next month will grow more slowly than anticipated.
Energy traders also remain concerned a threatened incursion by Turkish armed forces into Iraq in search of Kurdish rebels would cut oil supplies out of northern Iraq. Turkey warned Thursday that U.S. objections will not stop its troops from crossing into Iraq to pursue Kurdish separatists, while a steady stream of U.S.-made Turkish fighter jets roared across the skies along the border.
December Brent crude rose $1.41 to $88.89 a barrel on the ICE futures exchange in London.
Nymex heating oil futures rose 1.79 cents to $2.4263 a gallon (3.8 liters) while gasoline prices added 2.89 cents to $2.2647 a gallon. November natural gas futures fell 3.8 cents to $7.150 per 1,000 cubic feet.
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