Iran General NewsOil rises above $62 after Iran seizes British naval...

Oil rises above $62 after Iran seizes British naval personnel

-

Bloomberg: Crude oil in New York jumped above $62 a barrel after Iran seized 15 British naval personnel, heightening the prospect of conflict involving OPEC’s second- biggest producer. By Mark Shenk

March 23 (Bloomberg) — Crude oil in New York jumped above $62 a barrel after Iran seized 15 British naval personnel, heightening the prospect of conflict involving OPEC’s second- biggest producer.

The U.K. demanded the immediate release of the marines after the incident that occurred in the Persian Gulf at about 10:30 a.m. Iraq time today. Signs that the United Nations Security Council will impose new sanctions on Iran to suspend its nuclear program also bolstered prices. A draft that would freeze the assets of a bank and bar some exports was presented yesterday.

“Any time tension rises in the Persian Gulf you have to be concerned,” said Tom Bentz, an oil broker with BNP Paribas Inc. in New York. “Worries that Iran would take oil off the market because of the nuclear dispute have been pushing prices higher for a while now. We are in a world that can’t afford to have any supply taken off the market.”

Crude oil for May delivery rose 79 cents, or 1.3 percent, to $62.48 a barrel at 11:38 a.m. on the New York Mercantile Exchange. Futures jumped to $62.65, the highest for a front-month contract since Dec. 26 and the highest for the May contract since March 9. The May contract is up 4.9 percent this week. Prices are down 2.2 percent from a year ago.

Draft Resolution

The Security Council may vote today or tomorrow on the draft resolution. The U.S. and European governments say Iran intends to produce nuclear arms. Iran says it is pursuing an atomic program for energy-generation.

The U.S. today issued visas for Iranian President Mahmoud Ahmadinejad and his delegation before the Security Council vote, Agence France-Presse said, citing State Department spokesman Sean McCormack. The Iranian leader has asked to address the Council.

Iran has the second-biggest proved oil reserves. Almost a quarter of the world’s oil flows through the Strait of Hormuz, a narrow waterway between Iran and Oman at the mouth of the Persian Gulf.

Prices rose in 1974 after an oil embargo that followed the Arab-Israeli war and from 1979 through 1981 after Iran cut oil exports. The average cost of oil used by U.S. refiners was $35.24 a barrel in 1981, according to the Energy Department, or $79.67 in today’s dollars.

“The big bullish factor out there is the threat to supplies in the Persian Gulf,” said Rick Mueller, an analyst with Energy Security Analysis Inc. in Tilburg, the Netherlands. “Stories like Iran’s seizure of British forces are the types of things that will send prices higher.”

Global inventories have declined as the Organization of Petroleum Exporting Countries implements an agreement to cut production by 1.7 million barrels a day.

Brent crude oil for May settlement rose $1, or 1.6 percent, to $63.51 a barrel on the London-based ICE Futures exchange. Futures touched $63.68 a barrel, the highest intraday price since Dec. 8.

Gasoline Demand

Increased concern about Iran comes as U.S. refiners prepare to increase gasoline output before the summer driving season. U.S. gasoline demand peaks between the Memorial Day holiday in late May and Labor Day in early September.

U.S. gasoline supplies slipped 16.7 million barrels, or 7.3 percent, to 210.5 million barrels in the past six weeks, the Energy Department report on March 21 showed.

Gasoline for April delivery in New York rose 2.2 cents, or 1.1 percent, to $1.9795 a gallon. The contract touched $1.9953 a gallon, the highest since Aug. 21.

Regular gasoline at the pump, averaged nationwide, rose 0.5 cent to $2.577 a gallon, according to AAA, the nation’s largest motorist organization. Gasoline prices have jumped 13 percent over the past month and are up 2.6 percent from a year ago.

Latest news

Iran Is on the Brink of a Revolution

The wall of fear has been broken. In many cities across Iran, women are taking to the streets, leading...

Iran’s Regime Claims To Fill Global Energy Gap Despite Crippled Petroleum Sector

In recent weeks, the Iranian regime’s officials have been constantly exaggerating their huge capacity in oil and gas reserves...

What Is Happening in Iran?

Following the brutal killing of Masha Amini, the Iranian people have once again united to fight and defeat the...

Iran Regime’s Ministry of Culture’s Decision To Eliminate Children’s Intellectual Centers

With the so-called ‘Cultural Revolution’ which took place between 1980 and 1983, the Iranian regime tried to purge the...

Water Shortage Crisis and the Destruction of Iran’s Water Resources

Iran is currently suffering from a number of dangerous natural disasters. One of the most worrying is the drying...

Economic Freedom Under the Rule of the Mullahs in Iran

The Fraser institute published its annual report of the index of economic freedom on September 8, which measured the...

Must read

China fuel oil imports climb to five-year high on Iran supplies

Bloomberg: China’s fuel oil imports surged to the highest...

Registration starts for Iran’s parliamentary poll

AP: Iran on Saturday began registering potential candidates for...

You might also likeRELATED
Recommended to you