Oil rallies to 1-month high on Venezuela supply row
Monday, February 11, 2008
LONDON (Thomson Financial) - Oil rallied to a one-month high late afternoon as the ongoing supply spat between the US and Venezuela and expectations for a cold snap sent jitters through the market.
News of an equipment failure at a Delaware refinery operated by Valero added upward momentum to a market already buoyed by supply fears, analysts said.
Prices climbed more than 4 usd a barrel on Friday and were driven still higher overnight after Venezuelan president Hugo Chavez threatened to cut oil supplies to the US yesterday, before slipping into consolidation mode in morning trade.
However, the news is still fuelling buying this afternoon, analysts said.
"The market is very volatile right now," said Alaron trader Phil Flynn. "The weather forecasts continue to be cold, and heating oil is leading us up on this rally. That is adding to uncertainty (over Venezuela) to keep the market pretty well supported."
At 5.10 pm, New York's WTI crude for March delivery was up 2.02 usd at 93.79 usd per barrel, having earlier touched a high of 94.72 usd, its strongest level since Jan 10.
Meanwhile in London, Brent crude for March delivery was up 1.81 usd at 93.75 usd per barrel.
Chavez's claim that he will halt US sales is linked to legal action brought by Exxon Mobil. The oil giant is pursuing the assets of state oil company Petroleos de Venezuela in US, British and Dutch courts as it challenges the nationalisation of a multibillion dollar oil project by Chavez's government.
A British court has issued an injunction freezing as much as 12 bln usd in assets, leading Chavez to threaten to cut off oil supply to the superpower.
"If you end up freezing (Venezuelan assets) and it harms us, we're going to harm you," Chavez said yesterday. "Do you know how? We aren't going to send oil to the United States. Take note, Mr. Bush, Mr. Danger."
Venezuela, the world's fifth-biggest oil exporter, is also the fourth-largest supplier of crude to the US. While analysts earlier discounted Chavez's threats as unlikely to materialise, uncertainty over the president's next move is continuing to unsettle the market, analysts said.
Any prospect of a supply shortfall is likely to strongly propel prices higher. They rallied towards the end of last week on news that political tensions could cut exports from Nigeria by as much as 1 mln barrels a day, and amid fears of reduced production in the North Sea.
"This week's trading focus will continue to gravitate away from economic indicators and the possibility of a recession and toward geopolitical events capable of disrupting export flows from major producers such as Nigeria and Venezuela," said Ritterbusch & Associates head Jim Ritterbusch.
"For now, we continue to view the Nigerian supply situation as likely having a larger near-term impact on global oil balances and as such we expect further Nigerian developments this week to maintain volatility at a high pitch with an upward bias," he added.
i have seen your web page its interesting and informative.
I really like the content you provide in the web page.
But you can do more with your web page spice up your page, don't stop providing the simple page you can provide more features like forums, polls, CMS,contact forms and many more features.
Convert your blog "yourname.blogspot.com" to www.yourname.com completely free.
free Blog services provide only simple blogs but we can provide free website for you where you can provide multiple services or features rather than only simple blog.
Become proud owner of the own site and have your presence in the cyber space.
we provide you free website+ free web hosting + list of your choice of scripts like(blog scripts,CMS scripts, forums scripts and may scripts) all the above services are absolutely free.
The list of services we provide are
1. Complete free services no hidden cost
2. Free websites like www.YourName.com
3. Multiple free websites also provided
4. Free webspace of1000 Mb / 1 Gb
5. Unlimited email ids for your website like (info@yoursite.com, contact@yoursite.com)
6. PHP 4.x
7. MYSQL (Unlimited databases)
8. Unlimited Bandwidth
9. Hundreds of Free scripts to install in your website (like Blog scripts, Forum scripts and many CMS scripts)
10. We install extra scripts on request
11. Hundreds of free templates to select
12. Technical support by email
Please visit our website for more details www.HyperWebEnable.com and www.HyperWebEnable.com/freewebsite.php
Please contact us for more information.
Sincerely,
HyperWebEnable team
info@HyperWebEnable.com