Crude Oil / NYMEX & Brent
Crude Oil Rises Amid Expectations U.S. Will Pursue War in Iraq
By Stephen Voss
London, March 4 (Bloomberg) -- Crude oil rose amid expectations the U.S. will press for war with Iraq to rid the Middle East oil producer of banned weapons.
Chief United Nations arms inspector Hans Blix will report Friday to the UN Security Council and a vote on a U.S.-backed resolution will be sought ``soon thereafter,'' U.S. Ambassador John Negroponte said yesterday. London oil prices are 49 percent higher than a year ago, partly on concerns Middle East oil supplies may be disrupted by an Iraq war.
``The belief is that there will be a conflict with Iraq and the fundamentals underlying oil prices are strong anyway, such as low inventories,'' said Dave Thomas, an oil analyst at Commerzbank Securities in London.
Brent crude oil for April settlement was 44 cents higher at $32.92 a barrel at 11 a.m. on London's International Petroleum Exchange. Brent reached $33.94 a week ago, the highest intra-day price for a contract closest to expiration since Nov. 20, 2000.
In New York, crude oil for April delivery was up 30 cents at $34.54 a barrel in electronic trading on the New York Mercantile Exchange.
The first of the U.S. B-52 bombers that may be deployed over Iraq landed today at an air base in England, Sky News reported. In Texas, the 17,000-member U.S. 1st Cavalry, the Army's largest and most-heavily armored division, received orders to prepare to go overseas, unit spokesman Major Vic Harris said.
``The military build up, such as the B-52s arriving in the U.K., adds to the pressure toward war,'' Thomas said.
The U.S. and U.K. say Iraqi President Saddam Hussein is deceiving the world about his weapons programs. Hussein has denied the allegations.
Fuel Supplies
Crude oil earlier rose on the Nymex on concerns U.S. and Japanese inventories of heating fuel dropped last week because of cold weather in the world's two biggest oil-consuming nations. The U.S. Energy Department reports weekly supplies tomorrow.
``Demand for heating oil is very, very strong in the U.S. because of cold snaps,'' said Yasuo Yamada, an oil analyst at Mitsubishi Corporation Futures Ltd. ``People are predicting a drawdown in stock levels again for last week.''
U.S. supplies of distillate fuels, including heating oil and diesel, fell in the week ended Feb. 21 to less than 100 million barrels for the first time since May 2000, the Energy Department said last week. |
