Oil prices hovered above US$78 per barrel yesterday, near record highs, as intensifying violence in the Middle East raised concerns of a possible disruption of oil supply.
"We are certainly in uncharted territory," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.
"I wouldn't be surprised if US$80 is attained soon with this slew of geopolitical events in a tight market," he said.
PHOTO: AFP
Oil prices are being pushed higher by rising global demand and worries that the world's limited supply cushion would not be adequate to offset a lengthy disruption to output in major producing countries, such as Iran or Nigeria. There are also concerns about the risks hurricanes pose to US production.
"We haven't even taken into account a potential hurricane in the United States, so getting to US$80 and beyond this summer seems quite inevitable," Shum said.
"But if these Middle East events somehow get resolved, prices could also drop sharply," he said.
While Israel and Lebanon are not involved in the Middle East oil market, the fear is that the conflict could spill into other corner of the region, which produces nearly a third the world's oil and contains almost two-thirds of its untapped reserves.
Light sweet crude for delivery next month was up US$1.35 to US$78.05 a barrel in midafternoon Asian trading on the New York Mercantile Exchange. The price closed on Thursday at a new high of US$76.70 a barrel, then continued climbing in after-hours electronic trading, when volumes are significantly lower, to US$78.40.
The Brent contract for next month at London's ICE Futures exchange, which expired at the close of trading yesterday, jumped US$1.16 to US$77.85 per barrel.
The rally came as fighting between Israel and Lebanon intensified, explosions hit Nigerian oil installations and a diplomatic standoff dragged on between the West and Iran over its nuclear program.
The surge in oil prices rattled global financial markets, with Japan's Nikkei 225 index falling 1.7 percent yesterday, while the Dow Jones industrial average dropped 1.5 percent on Thursday.
The previous Nymex settlement record of US$75.19 was set on July 5. The previous intraday record of US$75.78 was posted two days later.
In other trading, gasoline futures climbed US$0.0352 to US$2.3365 a gallon, heating oil futures rose more than US$0.04 to US$2.1238 a gallon and natural gas futures advanced US$0.099 to US$6.228 per 1,000 cubic feet.
Meanwhile, Iran has threatened on more than one occasion to use oil as a weapon if the UN uses economic sanctions or some other punishment in its dispute with Tehran over its nuclear program.
While OPEC's No. 2 supplier has not raised the issue of withholding oil from the market in a sign of solidarity with Hezbollah, the possibility is no doubt influencing oil traders' actions.
A global survey showed that 60 percent of Taiwanese had attained higher education, second only to Canada, the Ministry of the Interior said. Taiwan easily surpassed the global average of 43 percent and ranked ahead of major economies, including Japan, South Korea and the US, data from the Organisation for Economic Co-operation and Development (OECD) for 2024 showed. Taiwan has a high literacy rate, data released by the ministry showed. As of the end of last year, Taiwan had 20.617 million people aged 15 or older, accounting for 88.5 percent of the total population, with a literacy rate of 99.4 percent, the data
Taiwan has arranged for about 8 million barrels of crude oil, or about one-third of its monthly needs, to be shipped from the Red Sea this month to bypass the Strait of Hormuz and ease domestic supply pressures, CPC Corp, Taiwan (CPC, 台灣中油) said yesterday. The state-run oil company has worked with Middle Eastern suppliers to secure routes other than the Strait of Hormuz, through which about 20 percent of the world’s oil and liquefied natural gas typically passes, CPC chairman Fang Jeng-zen (方振仁) said at a meeting of the legislature’s Economics Committee in Taipei. Suppliers in Saudi Arabia have indicated they
CCP ‘PAWN’? Beijing could use the KMT chairwoman’s visit to signal to the world that many people in Taiwan support the ‘one China’ principle, an academic said Chinese Nationalist Party (KMT) Chairwoman Cheng Li-wun (鄭麗文) yesterday arrived in China for a “peace” mission and potential meeting with Chinese President Xi Jinping (習近平), while a Taiwanese minister detailed the number of Chinese warships currently deployed around the nation. Cheng is visiting at a time of increased Chinese military pressure on Taiwan, as the opposition-dominated Legislative Yuan stalls a government plan for US$40 billion in extra defense spending. Speaking to reporters before going to the airport, Cheng said she was going on a “historic journey for peace,” but added that some people felt uneasy about her trip. “If you truly love Taiwan,
NEW LOW: The council in 2024 based predictions on a pessimistic estimate for the nation’s total fertility rate of 0.84, but last year that rate was 0.69, 17 percent lower An expected National Development Council (NDC) report expects the nation’s population to drop below 12 million by 2065, with the old-age dependency ratio to top 100 percent sooner than 2070, sources said yesterday. The council is slated to release its latest population projections in August, using an ultra-low fertility model, the sources said. The previous report projected that Taiwan’s population would fall to 14.37 million by 2070, but based on a new estimate of the total fertility rate (TFR) — the average number of children born to a woman over her lifetime — the population is expected to reach 12 million by
RSS