10 January 2012 12:22 [Source: ICIS news]
SINGAPORE (ICIS)--Crude futures rose by more than $1/bbl on Tuesday amid supply concerns that have been heightened by tensions between the west and Iran, and civil unrest in Nigeria.
At 11:31 GMT, February NYMEX light sweet crude futures (WTI) were trading at $102.98/bbl, up by $1.67/bbl on the previous close. Earlier the US benchmark rose to a session high of $103.09/bbl, up by $1.78/bbl from the previous close.
February Brent crude on London’s ICE futures exchange was trading at $113.36/bbl, up by 91 cents/bbl from the previous close. Earlier, the North Sea benchmark rose to a session high of $113.61/bbl, up by $1.16/bbl.
Crude was again boosted by worries over disruptions to Gulf supplies and the loss of access to Iranian crude. The EU announced on Tuesday that it had brought forward a meeting to decide on an embargo on Iranian oil imports. The meeting will now take place on 23 January. The EU has already agreed in principle to ban oil imports from Iran.
Western powers have tightened sanctions against Iran amid concerns over Tehran’s nuclear programme. Worries have risen since it emerged that Iran had started to enrich uranium. The west believes Iran is developing nuclear weapons. However, Iran claims that its nuclear programme is for peaceful purposes.
Iran has threatened to prevent oil movements through the strategically important Strait of Hormuz if sanctions are imposed on its oil exports. Oil exports from Saudi Arabia, the United Arab Emirates, Kuwait, Iraq and Iran are all shipped through the Strait of Hormuz.
Iran is the world’s fourth-largest oil producer with an output of around 3.55m bbl/day. It is also the third-largest oil exporter, according to data from the International Energy Agency (IEA).
Nationwide strikes in Nigeria triggered by the removal of subsidies on fuel added further supply worries, although oil production has yet to be impacted by the strike. Nigeria produces around 2.6m bbl/day of crude and is Africa’s largest exporter.
Concerns over eurozone debts continue to weigh on the market amid worries over the economic outlook for Europe and the impact on oil demand in the region.
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