SINGAPORE (AP) - Oil prices jumped Monday in reaction to a threat by Iran’s supreme leader that his nation could jeopardize the world’s oil supply if the West punished Tehran over its nuclear program.
Light, sweet crude for July delivery rose US$ 1.02 to US$ 73.35 a barrel in Asian electronic trading on the New York Mercantile Exchange, mid-afternoon in Singapore. The contract rose Friday to US.33 following the kidnapping of eight foreigners working on a drilling rig off the coast of Nigeria. The workers were released Sunday.
July Brent crude futures on London’s ICE Futures rose $ 1.03 to $ 72.06 per barrel.
Iran’s supreme leader, Ayatollah Ali Khamenei, who has the final say on all state matters, addressed Western nations in a speech Sunday, saying: "If you make any mistake (punish or attack Iran), definitely shipment of energy from this region will be seriously jeopardized."
Khamenei said the United States and its allies would be unable to secure oil shipments passing out of the Gulf through the strategic Strait of Hormuz to the Indian Ocean.
"The price surge is a knee-jerk reaction to the remarks made by Iran’s supreme leader," said Victor Shum, energy analyst with Purvin & Gertz in Singapore. He noted, however, that Iranian President Mahmoud Ahmadinejad had indicated a breakthrough in negotiations was possible, but rejected a precondition to talks.
Contrary to Khamenei’s remarks, other Iranian officials have repeatedly ruled out using oil as weapon. Iran is the world’s fourth largest oil exporter and has the second-largest reserves in the Organization of Petroleum Exporting Countries.
In London early trade, July-dated Brent contracts were up $ 1.57 at $ 72.60, after jumping .64 to close at .03 on Friday. Meanwhile, July-dated US light crude futures were up $ 1.40 at $ 73.75.
All prices are now nearing their all-time record high of $ 75.35 touched on April 21.
Oil prices gained almost on Friday after eight foreigners working on an Olsen Energy drilling rig off the coast of Nigeria were kidnapped by militants.
The workers were freed on Sunday but analysts said traders remained on edge about the security of supplies from Nigeria, where almost a quarter of national output remains disrupted following militant attacks earlier this year.
|
