Tuesday 29 July 2014
 
»
 
»
Story

Brent at $116; heads for biggest quarterly gain

Singapore, March 31, 2011

Brent crude rose 0.4 per cent towards $116 on Thursday, heading for the biggest quarterly gain in almost two years as war, revolutions, and unrest across the Mena region thrusted supply constraints to the forefront of investor concerns.

The global economic recovery also underpinned prices, although Japan's worst crisis since World War II triggered a dramatic reality check, resulting in the most turbulent and volatile quarter for the oil market since the end of 2008.

Brent crude for May advanced 42 cents on Thursday to $115.55 a barrel at 0339 GMT, about $4 from a 2-1/2-year high near $120 on Feb. 24, before it plunged to below $108 in the aftermath of Japan's earthquake.

US crude climbed 43 cents to $104.70.

Going forward, traders, analysts and investors see a new floor for prices around $100 a barrel, supported by supply risks and expanding economies. US private employers added more than 200,000 jobs in March, a report showed on Wednesday, ahead of government data on March non-farm payrolls due on Friday.

'The second quarter is a good period, and oil demand should be increasing,' said Tetsu Emori, a Tokyo-based commodities fund manager at Astmax Investments, adding he expects US crude to end the year close to $120.

'The world economy should be quite positive, especially after mid-May, and the downside for crude should be quite limited because of the geopolitical risk of disruption to supply in the Middle East and North Africa.'

US President Barack Obama has signed a secret order authorizing covert US government support for rebel forces seeking to oust Libyan leader Muammar Gaddafi, government officials told Reuters on Wednesday.

The US is part of a coalition, with NATO members and some Arab states, which is conducting air strikes on Libyan government forces under a UN mandate aimed at protecting civilians opposing Gaddafi.

Unrest in Libya erupted in February after revolutions toppled the leaders of Egypt and Tunisia in January, igniting protests against decades of autocratic rule in Syria, Yemen and Bahrain and minor demonstrations in countries including Morocco, Jordan, Algeria and Saudi Arabia, the world's top oil exporter.

As Saudi Arabia increased production partly to compensate for dwindling exports from Libya, concerns resurfaced that the kingdom's spare production capacity was shrinking, leaving world markets vulnerable to potential bigger disruptions.

Risks to demand growth

President Obama on Wednesday proposed to cut US oil imports by a third over 10 years, a goal that eluded his predecessors and seen as extremely ambitious by analysts sceptical it can succeed.

Japan's nuclear disaster has raised concern that growth in the world's third-largest economy may suffer. Japanese manufacturing activity slumped to a two-year low in March and posted its steepest monthly decline on record.

Workers struggling to prevent more radiation from escaping Japan's crippled nuclear plant face a hellish scenario -- with every attempt to get it under control seemingly creating life-threatening problems.

A final resolution of the nuclear disaster at the Fukushima Daiichi power station will likely take decades and experts say there could be many further setbacks and frightening moments to come, after Japan's strongest earthquake on record and an ensuing tsunami hit the reactors on March 11. – Reuters




Tags: Mena | Brent | Singapore | Obama | gains | US crude |

More INTERNATIONAL BUSINESS Stories

calendarCalendar of Events

Ads

Buy high quality China wholesale Health & Beauty , Electronics, Sports & Outdoors , Computers, Video Games, Toys & Hobbies Cell Phones, Automobiles and other wholesale products directly from reliable Chinese wholesalers or Factories on DHgate.com