Oil surges past $93 mark
Monday, 29 Oct 2007 09:04
Oil prices have been climbing on supply fears
Oil prices have surged past the $93 a barrel mark for the first time, amid ongoing supply fears and rising tensions in the Middle East.
The price of US light crude hit $93.20 in early Asian trading today, before easing back to $93.06.
Meanwhile the price of London's Brent crude also hit a fresh high of $89.90 a barrel.
With oil prices having already surged by more than a third since mid-August, the latest rises have seen the cost of fuel continue to head closer to the $100-a-barrel mark.
Fresh fears about growing political tensions between Turkey and Kurdish rebels in Iraq are behind the most recent hikes, analysts say.
Turkey's foreign minister Ali Babacan said yesterday that his country would be prepared to use both diplomatic and military operations against Kurdish rebels who are campaigning for the establishment of an independent homeland incorporating territory in Iraq and parts of eastern Turkey.
Ongoing fears that Turkey could take military action against Kurdish rebels in northern Iraq have prompted concerns that oil supplies could be disrupted by geopolitical developments in the region, sending prices soaring.
In addition oil prices have also been buoyed by supply fears, with Mexico's state-owned oil company Pemex having increased concerns about a possible shortfall in winter stocks after announcing that it was slashing its output due to bad weather in the Gulf of Mexico.
Supply concerns were also being exacerbated by the abduction of six foreign oil workers in Nigeria on Friday, a move which saw production cut in the region. Italian energy firm Eni SpA said gunmen in speedboats had kidnapped the workers after attacking an oil vessel off the coast of Nigeria.
Despite concerns that winter demand for oil will not be met the Organisation of Petroleum Exporting Countries (Opec) has stressed that it is currently unworried about soaring prices.
The secretary general of the oil producers' cartel, Abdalla Salem El-Badri, told the Wall Street Journal last week: "If it persists for a longer period, then we start worrying. But at this time we don't know what's going to happen next month."