LONDON: World oil prices rebounded toward $120 yesterday after news a pipeline carrying crude from Central Asia to the West would remain shut for about 15 days after a recent explosion.
New York’s main contract, light sweet crude for September delivery jumped $1.29 to $119.87 a barrel. Brent North Sea crude for September rallied $1.03 to $118.03 per barrel.
“Overall, the market remains at a cross road. Market participants are torn between persistent fears over slowing energy demand and potentials for further supply disruptions,” said Sucden analyst Andrey Kryuchenkov. It was announced yesterday that the Baku-Tbilisi-Ceyhan (BTC) oil pipeline would remain shut for about 15 days after a blast occurred in a pump at a section in eastern Turkey.
British energy giant BP said it was looking at three alternative means of delivering supplies to Western clients. A spokesman also told AFP that the company had begun to limit its output.
On Monday, prices slumped under $120 a barrel in New York and London for the first time in three months, as a tropical storm looked set to miss energy installations in the Gulf of Mexico.
Meanwhile, trading in the euro against the dollar turned highly volatile yesterday, with the single currency plunging, rallying and then falling again on comments from ECB head Jean-Claude Trichet.
The euro initially fell as low as 1.5396 dollars in mid-afternoon trading from 1.5502 shortly before the Trichet comments. But it then rallied to 1.5413 dollars as traders balanced the weight of his analysis before falling back to 1.5339 dollars, compared with 1.5408 late in New York on Wednesday.
On the London Bullion Market, the price of gold fell to $871.50 per ounce at the fixing from $879.50 late on Wednesday.
