Singapore: Oil began the new year trading higher above $96 a barrel on 2 January as geopolitical tensions weighed on the market, dealers said.
In morning trade, New York’s main contract, light sweet crude for February delivery, was 42 cents higher at $96.42 a barrel from $96 when floor trading closed in New York on Friday ahead of the New Year holiday.
Mass unrest in Pakistan following the assassination of opposition leader Benazir Bhutto last week led traders to price in a risk premium, dealers said.
From a low point of just below $50 last January, oil prices doubled in 2007.
Analysts are forecasting oil to top $100 in 2008 as crude faces strong demand and tight supplies amid robust economic growth in China and tensions in oil-producing regions.