Oil steadies at $142 on geopolitical, supply worries

Oil steadies at $142 on geopolitical, supply worries
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First Published: Fri, Jul 11 2008. 09 03 AM IST
Updated: Fri, Jul 11 2008. 09 03 AM IST
Reuters
Singapore: Oil steadied at near $142 a barrel rising 4% in the past session due to heightened geopolitical worries in Iran and Nigeria, as well as fears of supply disruption in Brazil.
US crude ticked down six cents to $141.59 a barrel, after jumping $5.60 a barrel on Thursday. London Brent crude dropped 33 cents at $141.70 a barrel.
The market was worried about potential supply disruptions from OPEC nation exporters.The Movement for the Emancipation of the Niger Delta, the main militant group in Nigeria’s oil-producing Niger Delta, said it was abandoning a ceasefire to protest a British offer to help tackle lawlessness in the region.
Rebel attacks on oil infrastructure in Nigeria, the world’s No. 8 exporter, partly bolstered crude prices to record highs over $145 this month, adding to a nearly 50% rise in prices this year.
Fuelling prices further, OPEC member Iran tested more missiles in the Gulf on Thursday, state media said, and the United States reminded Tehran it was ready to defend its allies.
Workers at Brazil’s Petrobras threatened to launch a five-day strike next week that would affect all 42 Campos basin offshore platforms, which account for more than 80% of daily oil output of around 1.8 million barrels.
Further support came from the weak dollar, which fell on renewed credit worries after capital concerns dragged down shares in major mortgage finance sources Fannie Mae and Freddie Mac. Investors have flocked to oil and other commodities this year as a hedge against rising inflation and the weak greenback.
But the International Energy Agency has forecast that pressure on oil markets could ease next year as demand growth slows, cutting the need for crude from OPEC.
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First Published: Fri, Jul 11 2008. 09 03 AM IST
More Topics: Markets | oil | IEA | OPEC | Petrobras |