Oil prices rise above $62 over Iran fearsPublished: Wednesday, 28 February, 2007, 08:46 AM Doha Time
LONDON: Oil prices extended gains yesterday as the US and its allies maintained pressure for tougher sanctions to curb Iran’s nuclear programme, dealers said.
Prices reached as high as $62.16 per barrel in London and $62.65 in New York.
Later yesterday, the price of Brent North Sea crude for April delivery showed a gain of 46¢ to $61.79 per barrel in London electronic deals.
New York’s main oil futures contract, light sweet crude for delivery in April, was up 51¢ at $61.90 per barrel in pit trading.
Traders were also looking ahead to today’s weekly update on US energy stockpiles, which could show a drop in supplies of heating fuel owing to cold weather in the final stages of the US winter.
“The rhetoric over Iran is heating up,” said Victor Shum, an analyst with energy consultancy Purvin and Gertz in Singapore.
“Even though there is no real (oil) supply disruption associated with that, the increasing rhetoric between Iran and the West and the likelihood of the UN imposing sanctions has put geopolitical news back on the front pages.
“That factor has put more of the investors back into the oil market.”
Iran, a key producer of crude oil, insisted yesterday that it would never yield to the key demand regarding its nuclear programme after world powers agreed to work on a new resolution that could lead to more UN sanctions against Tehran.
Diplomats from six key world powers had pledged in London on Monday to work on a new UN Security Council resolution over Iran’s refusal to suspend uranium enrichment work, which the West fears could be used to make nuclear weapons.
But Iranian Foreign Minister Manouchehr Mottaki retorted: “One thing that is not feasible is the Iranian nation backing down on having nuclear technology for peaceful purposes.”
Oil market buyers are concerned that if Iran is punished with economic sanctions, the country might decide to disrupt its oil exports.
Traders’ nerves were also jangled after two members of the US-led coalition and a US contractor died in a suicide blast yesterday outside an Afghan base where US Vice President Dick Cheney spent the night. – AFP