Oil prices spiked to a record above US$117 a barrel yesterday in Asia following an attack on a key pipeline in Nigeria at the end of last week.
Comments over the weekend by an OPEC official that the group isn’t likely to increase production also supported prices.
OPEC secretary-general Abdullah el al-Badri said on Sunday that oil prices would likely go higher and that the group was ready to raise production if the price pressure was due to a shortage of supply — something he doubted.
“Oil prices, there is a common understanding that has nothing to do with supply and demand,” al-Badri said on the sidelines of an energy conference in Rome.
Light, sweet crude for delivery next month rose as high as US$117.05 a barrel in Asian electronic trading on the New York Mercantile Exchange early yesterday. At midday in Singapore, the contract was trading at US$116.73 a barrel, up US$0.04 from the end of last week.
On Friday, May crude surged US$1.83 to US$116.69 a barrel following the attack on the Royal Dutch Shell PLC pipeline by the Movement for the Emancipation of the Niger Delta — the main militant group in Nigeria’s restive south.
The group also promised further attacks on the petroleum industry in Africa’s largest producer of crude oil.
On Friday, Shell confirmed a pipeline leak that it said appeared to have been caused by explosives. It said it had isolated the line for repairs and that a small quantity of production had been shut.
Attacks since early 2006 on Nigerian oil infrastructure by the militant group have cut nearly one-quarter of the country’s normal petroleum output, boosting oil prices. Nigeria is a major supplier of oil to the US.
A host of other supply and demand concerns in the US and abroad, along with the dollar’s weakness, have served to support prices, even as record retail gasoline prices in the US appear to be dampening demand. Crude prices rose nearly 6 percent last week.
Analysts believe the weaker dollar is the primary reason oil has soared well past US$100 a barrel this year. A sinking dollar draws investors to hard commodities such as oil and gold as hedges against inflation. Also, a weak dollar makes the commodities less expensive for buyers operating in other currencies.
On Sunday al-Badri said that the group “will not hesitate” to increase production if it thought the higher prices were due to shortages. But he said more oil will not solve the high prices.
Also over the weekend, Iranian President Mahmoud Ahmadinejad was quoted on Saturday as saying crude oil prices at US$115 a barrel are too low, and that oil must “discover its real value.”
“The oil price of US$115 a barrel in today’s global markets is a deceiving figure. Oil is a strategic commodity that needs to discover its real value,” the Web site of Iran’s state-run television quoted Ahmadinejad as saying.
The Iranian president made the remarks during a visit to an oil and gas exhibition in Tehran late on Friday.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS