Oil rises on Middle East worries
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Oil prices have risen again as traders weigh up supply issues and the geopolitical tensions building in the Middle East. US light, sweet crude, which had touched $89 a barrel on Wednesday, gained 28 cents to $87.68 while Brent added 21 cents to 83.34 dollars.Prices had pulled back in early trading after unexpectedly large gains in US oil and petrol inventories.
But simmering tensions along the Turkey-Iraq border have upped prices.
There are continuing concerns over tensions between Turkey and Kurdish rebels in Northern Iraq.
Turkey’s parliament has approved a government plan to attack rebels, raising fears of instability in the area.
Opec action?
Comments by a member of the oil producers’ cartel Opec that the group may now consider boosting output also helped the oil price pull back.
Nigerian oil minister Odein Ajumogobia said Opec leaders could now meet as early as 17 November, three weeks ahead of their next planned meeting.
“We are still a month away and it depends what transpires before then,” he added.
Oil prices have quadrupled since 2002 because of strong demand from fast-growing economies such as China and India, allied to instability in oil-producing nations in the Middle East and Africa.
The cost of oil is still below the inflation-adjusted level of about $90 a barrel seen in 1980, when spiralling prices helped contribute to a recession in the US.
Last month, Opec said that it would be boosting its production by 500,000 barrels per day from the beginning of next month, to cope with resilient global demand for oil.