Crude oil rose to the highest in two weeks in New York as renewed violence in the Middle East and Africa threatens to prolong supply disruptions.
Futures gained as much as 0.7 percent after Syrian security forces detained at least 200 protesters and unrest showed no sign of ending in Yemen. U.S. Senator John McCain said rebels in Libya need more assistance in the fight against Muammar Qaddafi’s forces. Saudi Arabia, holder of the world’s largest crude reserves, has no plans to raise production capacity, an oil official said.
“The supply-side story hasn’t changed, we lost more than 1 million barrels a day in Libya,” Dominic Schnider, a Singapore- based director for wealth management research at UBS AG, told Susan Li in a Bloomberg Television interview. “Even if you’re going to raise production, the market will be concerned about what happens down the road, if you have an outage in, let’s say, Nigeria, where you have high-quality crude.”
Crude oil for June delivery rose as much as 78 cents to $113.07 a barrel on the New York Mercantile Exchange. That was the highest intraday price since April 11, when futures reached $113.46, the most since September 2008. The contract was at $112.62 at 12:22 p.m. Singapore time.
Brent crude oil for June settlement increased 22 cents, or 0.2 percent, to $124.21 a barrel on the London-based ICE Futures Europe exchange.
Reports that Saudi Arabia may boost its output capacity to 15 million barrels a day aren’t true, the official said by telephone yesterday, declining to be identified by name because he isn’t authorized to speak publicly.
Political Changes
Oil has advanced 24 percent in New York this year. Unrest in the Middle East and North Africa has toppled leaders in Egypt and Tunisia and spread to Libya, Algeria, Bahrain, Iran, Oman, Syria and Yemen. Libyan crude output, which averaged 1.6 million barrels a day last year, fell to 390,000 barrels a day in March, according to a Bloomberg News survey.
Political turmoil in Nigeria, Africa’s largest oil producer and the fourth-biggest crude seller to the U.S., is also supporting prices above $100 a barrel, according to Ken Hasegawa, an energy trading manager at Newedge, a broker in Tokyo.
At least 500 people died in religious rioting that followed Nigeria’s presidential election, theAssociated Press reported today. The country is scheduled to hold state governorship elections tomorrow.
In Syria, Mahmoud Merhi, who heads the Arab Organization for Human Rights, said in an interview from Damascus that 200 to 300 people have been detained since April 22. Many of those arrested were taken from their homes at night, according to Haitham al-Maleh, a member of the Syrian Human Rights Committee, who estimates “hundreds” were arrested.
Brent Premium
“The ongoing coordinated actions in Libya to remove Qaddafi, if that is the actual purpose, is adding to the nervousness, prompting new buying in crude oil,” John Caiazzo, president of Acuvest Commodity Brokers Inc. in Temecula, California, said in a report e-mailed today. “Other producing areas experiencing turmoil include Yemen and Syria, where protesters are being killed as well.”
Demonstrators yesterday rallied in Sana’a, Yemen’s capital, demanding President Ali Abdullah Saleh’s unconditional departure. The leader has agreed with the opposition to a Gulf Cooperation Council-brokered peace plan.
The Brent contract for June was at a premium of $11.63 a barrel to New York futures settling in the same month, Bloomberg data showed. The premium has shrunk $2.41 from a week earlier on signs that supplies are falling at Cushing, Oklahoma, the delivery point for West Texas Intermediate grade.
U.S. crude inventories fell 2.32 million barrels to 357 million, the first drop since February, the Energy Department said April 21. Cushing stockpiles declined 770,000 barrels to 41 million barrels, the biggest drop since April 2.
Oil prices may rise this week, a Bloomberg News survey showed. Twelve of 32 analysts, or 38 percent, forecast oil will increase through April 29.
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