Tags: Crude | Oil | Soars | Amid | Supply | Uncertainties

Crude Oil Soars Amid Supply Uncertainties

Monday, 17 September 2001 12:00 AM

The North Sea Brent crude oil for November rose to $29.70 a barrel on the International Petroleum Exchange in London despite OPEC assurances of increased supplies. Although the prices eased during later trading, oil industry sources said the uncertainty was likely to keep the market volatile.

It was the highest level reached in Brent prices since last week, when the benchmark crude rose to $31.05 a barrel after the terrorist action in New York and Washington.

Analysts said the uncertainty was fed by fears of possible U.S. retaliation against some of the OPEC producers who are also on the State Department list of state sponsors of terrorism. Aside from Iraq, Iran and Libya are also on that State Department list, but both governments have issued statements sympathetic to the United States following the terror attacks.

London traders said they awaited outcome of a scheduled but brief reopening of the New York Mercantile Exchange on Monday. The London Center for Energy Studies, run by former Saudi oil minister Zaki Yamani, said last week's "tragic events in the U.S. have undermined the prospects for oil-demand growth in the near future." The CGES said in its monthly oil report that traders nervous over the scale of U.S. response and its potential impact on oil supplies from the Middle East were "bidding up prices."

It said the markets would remain volatile over the "next few weeks, reacting to rumor."

The center said market fears were not easily assuaged by OPEC members' pronouncements that they would keep supplies open, because repercussions from the current situation might make it politically difficult for Arab countries to boost oil output.

"Iraq may use the situation to suspend exports again, but a measured U.S. response, with the support of its Arab allies, would allow supply disruptions to be overcome," said the center.

Copyright 2001 by United Press International. All rights reserved.

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The North Sea Brent crude oil for November rose to $29.70 a barrel on the International Petroleum Exchange in London despite OPEC assurances of increased supplies. Although the prices eased during later trading, oil industry sources said the uncertainty was likely to keep...
Crude,Oil,Soars,Amid,Supply,Uncertainties
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2001-00-17
Monday, 17 September 2001 12:00 AM
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