Crude hits new record highs amid supply concerns

09 May 2008 08:34  [Source: ICIS news]

SINGAPORE (ICIS news)--Crude futures gained more than $1/bbl on Friday to hit new record highs in Asian trade, pushing June NYMEX light sweet crude futures to a peak amid concerns over tight global supplies of distillates, geopolitical tensions and renewed fund buying.

At 06:57 GMT on Friday, June NYMEX light sweet crude futures were traded at $124.35/bbl, up $0.66/bbl from Thursday’s settlement price. Earlier, the contract hit a new all time record high of $124.73/bbl, up $1.04/bbl.

Meanwhile, ICE Brent futures were traded at $123.60/bbl, up $0.76/bbl, after earlier hitting a new record high of $124.25/bbl, up $1.41/bbl from the previous close.

Prices have continued to climb since supply data released on Wednesday revealed an unexpected drawdown in US distillate stocks of 100,000 bbls last week, against a forecasted rise of 800,000 bbls.

The decline triggered renewed concerns about global distillate inventories particularly those in Europe and Asia.

On Thursday, NYMEX June heating oil futures hit a new record of $3.531/gallon, while May ICE gasoil futures hit a new record of $1,1171.25/tonne.

The strong rise in crude prices in recent days served to attract additional fund money into the energy markets.

Concerns over the security of Nigerian supplies remained despite news on Wednesday that ExxonMobil had lifted force majeure on its oil exports from Nigeria amid ongoing talks with striking oil workers.

ExxonMobil was forced to shut-in around 800,000 bbls/day of production in late April after oil workers went on strike over a pay dispute.

Shell announced on Thursday that 164,000 bbl/day of Bonny Light production in Nigeria remained shut-in following a series of recent sabotage attacks by militants on oil facilities.

Meanwhile, geopolitical tensions between the West and Iran remained high after Iran’s Foreign Ministry said earlier this week that it would not accept a package incentives from the West designed to curb Tehran’s nuclear ambitions.

($1 = €0.65)

By: James Dennis
+65 6780 4359

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