World Oil prices surge
Pastor Dale Morgan
*World Oil prices surge*
From correspondents in London
August 03, 2006 04:30am
Article from: Agence France-Presse
WORLD oil prices soared today as traders fretted over the possibility of
hurricanes striking energy facilities in the US Gulf of Mexico, dealers
said.
New York's main contract, light sweet crude for delivery in September,
leapt 94 US cents to $US75.85 a barrel in pit trading, after touching a
high of $US76.50, last seen on July 18.
In London, Brent North Sea crude for September delivery jumped $US1.04
to $US76.93 a barrel in electronic deals, after earlier hitting $US77.47
- the highest level since July 18.
The jump in oil prices also followed news that US crude oil and petrol
reserves fell last week and came amid the ongoing Israeli offensive in
Lebanon.
"The reason people started buying again was essentially worries about
the hurricanes," said Societe Generale oil market analyst Deborah White.
Hurricane Chris could strengthen into the season's first hurricane today
as it moved north of Puerto Rico on the western edge of the Atlantic,
the US National Hurricane Centre said.
"Tropical storm Chris is supposed to reach hurricane status within two
days and it's heading towards the Gulf coast," Ms White said.
"It just reminds us of last year's hurricane season. The market is
thinking that we may lose more crude and more refining capacity."
Last year, energy facilities on the rig-heavy US Gulf Coast were ravaged
by hurricanes, pushing oil prices to then record high points.
Chris is the third Atlantic storm since last year's record smashing
season of 28 named storms, including 15 that became hurricanes.
Crude futures are now within reach of record peaks hit last month as
violence erupted between Israel and Lebanon. Brent spiked to $US78.18 a
barrel on July 17, while New York crude hit $US78.40 on July 14.
Today the US Department of Energy revealed that US crude oil inventories
fell 1.8 million barrels to 333.7 million barrels in the week to July
28, compared with analysts' forecasts of a drop of 875,000 barrels.
Petrol stocks dropped by 100,000 barrels last week to 210.9 million, the
report showed, compared to predictions for a much larger drop of 1.8
million barrels.
Violence in the Middle East continued to support high price levels.
In Iran, supreme leader Ayatollah Ali Khamenei called today on Muslims
everywhere to resist US and Israeli aggressions as his country faced a
UN deadline to halt uranium enrichment or have sanctions imposed.
In the event of sanctions, security analysts have said that Iran might
retaliate and block the Strait of Hormuz, which is a crucial transport
route for oil shipments to Japan, the US and Western Europe.