Terror plot foiled, oil jumps
Sunday, April 29, 2007
OIL prices rose on Friday after Saudi Arabia said it foiled an al-Qaeda-linked plot to attack the kingdom's oil facilities, rekindling concerns over the vulnerability of world energy supplies.
The news came against the backdrop of expectations that the United States will face a gasoline inventory crunch when drivers hit the roads this summer vacation season after a slew of refinery outages slashed stockpiles.
London Brent crude , currently seen as more representative of global oil prices, gained 76 cents to US$68.41 a barrel. US crude settled up US$1.40 to US$66.46. Opec kingpin Saudi Arabia said it arrested 170 people suspected in a plot to attack oil facilities and military bases, including some trainee pilots preparing for suicide operations.
"One of their main targets was to carry out suicide attacks against public figures and oil installations and to target military bases inside and outside (the country)," according to a Saudi Interior Ministry statement. Oil dealers said the news triggered a quick run-up in crude futures, after prices had started the day in negative territory. "We bottomed out around the time the Saudi news hit and we've been working our way up since then," said Eric Wittenauer, analyst at AG Edwards in Chicago. "With the geopolitical tension, especially in the producer regions, it's hard to be short going into the weekend." Prices have also been supported by unplanned outages and refinery maintenance in the United States, including a fire Thursday at a key oil refinery in Louisiana operated by Marathon Oil .
Low production from US refineries due to maintenance and unplanned repairs have cut the nation's stockpiles nearly 15 per cent since early February. Reuters
The news came against the backdrop of expectations that the United States will face a gasoline inventory crunch when drivers hit the roads this summer vacation season after a slew of refinery outages slashed stockpiles.
London Brent crude , currently seen as more representative of global oil prices, gained 76 cents to US$68.41 a barrel. US crude settled up US$1.40 to US$66.46. Opec kingpin Saudi Arabia said it arrested 170 people suspected in a plot to attack oil facilities and military bases, including some trainee pilots preparing for suicide operations.
"One of their main targets was to carry out suicide attacks against public figures and oil installations and to target military bases inside and outside (the country)," according to a Saudi Interior Ministry statement. Oil dealers said the news triggered a quick run-up in crude futures, after prices had started the day in negative territory. "We bottomed out around the time the Saudi news hit and we've been working our way up since then," said Eric Wittenauer, analyst at AG Edwards in Chicago. "With the geopolitical tension, especially in the producer regions, it's hard to be short going into the weekend." Prices have also been supported by unplanned outages and refinery maintenance in the United States, including a fire Thursday at a key oil refinery in Louisiana operated by Marathon Oil .
Low production from US refineries due to maintenance and unplanned repairs have cut the nation's stockpiles nearly 15 per cent since early February. Reuters
Business Besides Oil
