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.
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
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
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College
RSS