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Crude oil price sets new record near $147 a barrel

Crude oil price sets new record near $147 a barrel
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First Published: Fri, Jul 11 2008. 10 41 PM IST

Warning noteP: A file photo of US secretary of state Condoleezza Rice.
Warning noteP: A file photo of US secretary of state Condoleezza Rice.
Updated: Fri, Jul 11 2008. 10 41 PM IST
Oil prices set a new record near $147 (Rs6,276.9) a barrel on Friday, boosted by concerns over possible disruption of tight global supplies amid tensions over Iran’s launch of test missiles and the threatened renewal of oil-related violence in Nigeria. By the afternoon in Europe, light, sweet crude for August delivery was up $4.93 on the day at $146.58 a barrel in electronic trading on the New York Mercantile Exchange. Earlier in the session, it hit a new trading high of $146.90 before retreating.
The contract rose $5.60 in the overnight floor session to $141.65 a barrel — after losing nearly $10 on Monday and Tuesday and then gaining a penny on Wednesday.
Warning noteP: A file photo of US secretary of state Condoleezza Rice.
In London, August Brent crude was up $4.84 to $146.47 a barrel on the ICE Futures exchange. The contract rose as high as $147.25 earlier Friday.
A day after Iran tested a missile capable of reaching Israel, US secretary of state Condoleezza Rice warned the oil-producing nation that the US will defend its allies. Iran then responded with another missile launch.
Both the US and Israel have not ruled out a military strike on Iran as a last option if it does not give up uranium enrichment and heed other UN Security Council demands meant to dispel the fear Tehran wants to make nuclear arms.
The Organization of Petroleum Exporting Countries (Opec) has warned that it cannot replace the shortfall if Iran is attacked and takes its crude supplies off the market.
The fear is that Iran, Opec’s second largest producer, could block the Strait of Hormuz, a passageway that handles about 40% of the world’s tanker traffic.
Meanwhile, attacks on Nigerian oil facilities could again disrupt supplies in the oil-rich region. Nigeria’s main militant group vowed on Thursday to resume attacks because of Britain’s recent pledge to back the government in the conflict there. Unrest over the past two years have already slashed the country’s normal daily oil output by a quarter. Still, while supply worries abound and the dollar remains weak compared with levels a year ago, many investors are seeing reasons to believe that oil might be peaking because of resistance to the record-level prices.
Madlen Read in New York and Eileen Ng in Kuala Lumpur contributed to this story.
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First Published: Fri, Jul 11 2008. 10 41 PM IST