Monday, January 31, 2011

Egypt unrest and strong earnings drive oil up; Brent tops $100 a barrel

Brent crude oil topped $100 for the first time since 2008 as investors kept an anxious eye on Egypt and worried about unrest there disrupting the flow of oil from the Middle East.

Brent is the benchmark for oil prices in Europe and Asia. The price of West Texas Intermediate, the benchmark in the U.S., rose $1.46 to $90.80 a barrel in midday trading on the New York Mercantile Exchange.
While Egypt is not a major oil-producing country, each day almost two million barrels of oil pass through the Suez Canal, which is controlled by Egypt. The Suez remains open and shipping has not been interrupted.
"Those watching it closely do not believe it is terribly likely to happen soon or at all, but recognize the possibility that it could occur," energy consultants Cameron Hanover said.
In London, Brent crude rose $1.18 to $100.60 a barrel on the ICE Futures exchange. That's the first break above $100 since September 2008.
Oil prices also got a boost from positive U.S. economic news and rising stock markets. The Commerce Department said that consumer spending rose sharply in December, and purchases for the whole year increased at the fastest pace in three years.
Stocks of energy companies led major indexes higher after Exxon Mobil reported its most profitable quarter since the third quarter of 2008.
In other energy trading on the Nymex, heating oil added 2 cents at $2.7123 a gallon, gasoline futures were unchanged at $2.4829 a gallon and natural gas gained 5 cents at $4.372 per 1,000 cubic feet.

Source: Newser

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