LONDON: The price of New York’s main oil benchmark hit a nine-month peak yesterday, as traders worried that the Syria crisis could hit supplies from the crude-rich Middle East, analysts said.
New York’s main contract, West Texas Intermediate light sweet crude for delivery in August, reached $98.74 per barrel, a level last seen in September 2012. At the same time, Brent North Sea crude for August climbed to $106.67 a barrel.
“Fears that Western intervention in Syria could increase the risks of a broader Middle East conflict have already put some upward pressure on the price of Brent crude,” said Capital Economics analyst Julian Jessop.
“However, even if tensions do continue to rise — which all the major players would want to avoid — we would expect any fallout for global oil markets to be more than offset by the prospect of releases from the vast strategic reserves held by the US and its allies.”
Brent later stood at $106.08 in London late afternoon deals, up 15 cents compared with Friday’s close. New York crude traded 26 cents higher at $98.11 a barrel. “The oil price is currently being driven primarily by geopolitical aspects,” said Commerzbank analyst Carsten Fritsch.
Market attention was also on the Federal Reserve’s upcoming monetary policy meeting later this week. The US central bank’s Federal Open Market Committee, which sets the benchmark US dollar interest rate, meets today and tomorrow and investors are expecting greater clarity on whether it will hold down long-term rates with its $85bn-a-month bond buying programme.
AFP
