NEW YORK, 2 May 2006 — Oil prices jumped 2 percent yesterday to top $73 a barrel on concerns that supplies could take a hit from Iran’s defiant pursuit of its nuclear program and violence in Nigeria.
IPE Brent crude futures in London gained $1.66 to trade at $73.68 a barrel after a fire shut ERG group’s 160,000 barrel-per-day (bpd) Impianti Nord refinery in Sicily, adding to supply worries. US light sweet crude rose $1.47 to $73.35 a barrel in afternoon activity as markets remained fixed on Iran.
Concerns over Iran’s growing standoff with Western nations helped push US oil to a record high of $75.35 a barrel in late April. Prices fell after US President George W. Bush temporarily eased fuel standards to increase availability of refined products ahead of the summer driving season.
But US Energy Secretary Samual Bodman said the world’s top oil consumer may be facing an energy “crisis”. Government officials are concerned high US gasoline prices may become a political liability during congressional elections this year. “There is apparently some evidence we have a crisis,” Energy Secretary Samuel Bodman said in a televised interview over the weekend. Meanwhile, US blue chips advanced yesterday. The NASDAQ and S&P 500 indexes were little changed. Shares of Wal-Mart, the world’s largest retailer and a component on the Dow, gained 2.7 percent after the company said over the weekend that US same-store sales probably rose a faster-than-expected 6.8 percent.