LONDON, 28 February 2003 — Oil prices rocketed up to $40 a barrel in New York yesterday for the first time since the 1990-91 Gulf War as anxieties grew about a looming war in Iraq and depleted US oil stock levels.
In New York, benchmark light sweet crude for April delivery soared $2.30 to $40 per barrel in late morning trade, levels not seen since October 1990 in the wake of the Iraqi invasion of Kuwait. Traders chased prices higher on fears that a war in Iraq could be just around the corner, threatening disruption to Middle East supplies while US oil stocks are close to a 27-year low.
“A potentially supply-disruptive war may begin at any moment,” said Mike Fitzpatrick, oil trader at Fimat USA in New York.
The price of reference London Brent North Sea crude for April delivery rose to $33.20 in late trading from $33.07 at the close of the previous session.
Traders were fretting about the possible loss of Iraq oil while stocks of US crude oil and heating fuels are already reaching alarmingly low levels, analysts said.
“Crude oil inventories remain about as low as they possibly can be in the States and then you throw in on top of that the geopolitical concerns and you’ve got the recipe for crude moving up toward $40,” said JP Morgan analyst Paul Horsnell.
