Oil surges past $141 on Iran tensions, Nigeria
Oil prices jumped 4 percent to above $141 a barrel on Thursday amid threats to production in Nigeria and Brazil and an additional missile test by Iran that escalated tensions with the West.
Further support came from the weak dollar, which fell on renewed credit worries after capital concerns dragged down shares in major mortgage finance sources Fannie Mae and Freddie Mac.
U.S. crude settled up $5.60 at $141.65 a barrel, off a session high of $142.10 a barrel. London Brent crude settled $5.45 higher at $142.03 a barrel.
The Movement for the Emancipation of the Niger Delta, the main militant group in Nigeria's oil-producing Niger Delta, said it was abandoning a cease-fire to protest a British offer to help tackle lawlessness in the region, raising concern of further disruptions to the OPEC nation's exporters.
"The cease-fire in Nigeria is ending on the 12th, and that's creating some jitters as far as supply is concerned," said Rob Kurzatkowski, futures analyst with optionsXpress.
Rebel attacks on oil infrastructure in Nigeria, the world's No. 8 exporter, have helped push crude prices to record highs over $145 this month, adding to a nearly 50 percent rise in prices this year.
Concerns that tensions between Iran, another OPEC member, and the West over Tehran's nuclear program could lead to an oil supply disruption have added to bullish sentiment.
Iran tested more missiles in the Gulf on Thursday, state media said, and the United States reminded Tehran that it was ready to defend its allies.
But a U.S. official said there was no information to confirm rumors of a third Iran missile test late on Thursday as prices surged near the settlement. There was no mention of a third test on Iranian satellite channels Press TV or Al Alam on their broadcast on Thursday evening. Continued...
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Source: Reuters India
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