Sun, Apr 26, 2015 - Page 15 News List

Oil hits peak on strikes on Yemen

AFP, LONDON

Brent oil prices jumped this week to the highest level so far this year, as the latest Saudi-led air strikes on Yemen stoked supply tensions in the crude-rich Middle East.

Elsewhere, precious metal gold sank on sliding safe-haven demand as a result of easing tensions over Greece.

OIL: Brent prices on Friday hit a four-month peak of US$65.80 per barrel, the highest level since Dec. 10 last year, as Saudi-led coalition warplanes again hit Yemen.

“Saudi Arabia’s renewed bombing campaign in Yemen sent crude oil higher, with Brent rising to new 2015 highs,” CMC Markets analyst Jasper Lawler said.

The Saudi-led coalition launched more deadly strikes in Yemen on Thursday, despite a demand by Iran-backed rebels for a complete halt to the raids as a condition for UN-sponsored peace talks.

“Crude oil prices rebounded to reach four-month highs following news that Saudi Arabia renewed its aerial assault in Yemen to target the Shiite rebels,” senior energy analyst Myrto Sokou added at the Sucden brokerage in London. “Brent front month futures rallied ... amid renewed concerns of potential disruption in oil shipping across the Middle East.”

Yemen is not a major oil-producing country, but its coast forms one side of the Bab el-Mandeb Strait, the key strategic entry point into the Red Sea through which about 4.7 million barrels of oil pass each day on ships headed to or from the Suez Canal.

The Saudi-led coalition on Tuesday declared that the first phase of its operations against the Houthis and their allies was over, but there has been no end to its strikes.

Crude futures had fallen on Wednesday after weekly US petroleum data showed higher crude inventories, but marginally lower production.

US commercial crude reserves in the period ending Friday last week rose for the 15th straight week, adding 5.3 million barrels, the US Department of Energy said.

It added that the increase lifts US oil supplies to the highest level on record.

However, production slipped by 18,000 barrels a day, following a 20,000 barrel drop in the previous week.

Dealers are hoping a slowdown in US shale output could alleviate a global crude oversupply, which led to a collapse in prices of more than 50 percent between June last year and January.

By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in June rallied to US$65.21 a barrel from US$64 the previous week.

On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for June leapt to US$57.22 compared with US$56.12 for next month’s contract the previous week.

PRECIOUS METALS: Gold fell in value as investors eyed receding worries over Athens.

The metal — regarded by investors as a safe bet in times of turmoil — rose the previous week on uncertainty over a potential Greek eurozone exit.

Nevertheless, European ministers heaped pressure on Greece on Friday to speed up negotiations to unblock critically needed bailout funds and avert a dangerous default, showing frustration after months of bogged down talks.

By Friday on the London Bullion Market, the price of gold slid to US$1,183 an ounce, from US$1,203.35 the previous week.

Silver declined to US$15.83 an ounce from US$16.36.

On the London Platinum and Palladium Market, platinum dipped to US$1,128 an ounce from US$1,161.

Palladium eased to US$774 an ounce from US$777.

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