Oil prices rise on supply worries

Oil prices rise on supply worries
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First Published: Mon, Aug 11 2008. 09 53 AM IST
Updated: Mon, Aug 11 2008. 09 53 AM IST
AFP
Singapore: World oil prices rose by more than $1 in Asian trade Monday on supply concerns amid the escalating fighting between Georgia and Russia, dealers said.
In morning trade, New York’s main contract, light sweet crude for September delivery, was up $1.06 at $116.26 a barrel.
London’s Brent North Sea crude for September delivery gained $1.07 to $114.40.
Supply disruptions are once again a major concern. The head of Azerbaijan’s state oil company said Saturday that exports had been halted via two Georgian ports due to the fighting.
That announcement came shortly after Georgian Prime Minister Lado Gurgenidze said that Russian warplanes had staged a raid near the Baku-Tbilisi-Ceyhan (BTC) pipeline, the world’s second longest.
Georgia does not produce oil but the country is a key transit point for crude and gas exports from Azerbaijan to markets in the West.
“I think the Georgian issue is helping the market to focus back on the supply side... that has really changed the market quite a bit,” said Gerard Burg, an energy and minerals economist with National Australia Bank.
David Moore, commodity strategist with the Commonwealth Bank of Australia, said oil traders would be closely monitoring the military conflict.
Supply concerns pushed oil to record highs above $147 in July but slowing economic growth globally has seen prices ease sharply in recent weeks.
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First Published: Mon, Aug 11 2008. 09 53 AM IST