29 November 2012 12:56 [Source: ICIS news]
SINGAPORE (ICIS)--Crude futures rose by more than $1/bbl on Thursday, amid heightened tensions in the Middle East and a weaker US dollar.
At 12:09 GMT, January Brent crude on London’s ICE futures exchange was trading at $110.66/bbl (€85.21/bbl), up by $1.15/bbl from the previous close. Earlier, the North Sea benchmark rose to a session high of $111.00/bbl, up by $1.49/bbl.
January NYMEX light sweet crude futures (WTI) were trading at $87.56/bbl, up by $1.07/bbl from the previous close. Earlier, the US benchmark rose to a session high of $87.68, up by $1.19/bbl.
Protests continued in Egypt in response to the decision last week by President Mursi to greatly extend his powers. The move is opposed by opposition parties and the Egyptian judiciary. However, the Egyptian assembly – which is dominated by the president’s party, the Muslim Brotherhood – is in the process of writing a new constitution.
Meanwhile, the on-going civil war in Syria and the standoff between the West and Iran over Tehran’s nuclear programme continued to raise concerns over the security of crude supply from the Middle East. Nevertheless, the ceasefire continued to hold between Israel and Hamas forces in Gaza.
The US dollar declined against leading currencies such as the euro. The weaker US dollar made dollar-denominated commodities such as oil more attractive to overseas investors.
Weekly US inventory data from the US Government’s Energy Information Administration revealed an unexpected 347,000 bbl fall to 371.1m bbl. However, gasoline inventories rose by a much larger than expected 3.87m bbl.
Attention also remained focused on ongoing discussions between the US president and Republican congressional leaders, to resolve the US budget crisis.
The “fiscal cliff” of tax rises and spending cuts, which could derail the US economy, is set to be implemented on 1 January unless the parties can reach an agreement.
($1 = €0.77)
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