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Will it happen this weekend?


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Source: http://www.channelnewsasia.com/stories/afp.../359608/1/.html

 

 

Oil prices rally on tight supplies, Iran fears

Posted: 11 July 2008 0351 hrs

 

NEW YORK: Oil prices shot higher on Thursday on the back of simmering geopolitical tensions over key producer Iran and lingering worries over stretched global crude supplies, traders said.

 

The International Energy Agency (IEA), meanwhile, forecast that tension on oil markets was set to ease early next year amid an economic slowdown in the United States.

 

In addition, the OPEC oil producers' cartel cut its estimate for world crude demand over the next two decades, predicting that high prices would compel consumer countries to be more efficient in their use of the precious commodity.

 

New York's main oil futures contract, light sweet crude for August delivery, jumped 5.60 dollars to close at 141.65 dollars per barrel.

 

On the London market, Brent North Sea oil futures for August delivery leapt 5.45 dollars to settle at 142.03 dollars.

 

"Investors were not ready to liquidate their crude positions just yet, with persistent geopolitical fears and worries over long-term crude supply tightness," said Sucden analyst Andrey Kryuchenkov.

 

Prices have soared since breaking through 100 dollars at the start of the year but are down about five dollars from record peaks near 147 dollars last week.

 

Traders tracked events concerning Iran, which is OPEC's second-largest crude oil producer with an output of about 4.0 million barrels per day.

 

Iran test-fired more weaponry on Thursday as it continued war games, ignoring global concern over its launch of a broadside of missiles amid efforts to end a dispute over its nuclear programme.

 

The White House downplayed the risk of war between Iran and the United States, despite the Iranian missile tests and some tough talk by US Secretary of State Condoleezza Rice.

 

Rice warned Iran that Washington had beefed up its security presence in the Gulf and would not hesitate to defend its ally Israel.

 

Iran insists its nuclear drive is aimed solely at generating energy but some Western nations fear it could be aimed at making an atomic bomb and have called for a freeze of uranium enrichment.

 

OPEC would not be able to replace Iran's oil production if supplies were halted in case of a war with Israel or the United States, the oil cartel's chief said.

 

"I hope there will be no attack on Iran. I hope that problem will be solved peacefully," the Organisation of the Petroleum Exporting Countries' secretary general Abdalla Salem El-Badri told a news conference in Vienna.

 

"But if something were to happen, it is impossible to replace the production of Iran."

 

OPEC also cut its long-term estimate for world oil demand, saying consumption in 2030 would be 3.7 percent lower than previously forecast because of energy-saving.

 

The IEA, meanwhile, predicted that demand in advanced countries seemed to be on a weaker trend but it forecast a global increase in demand of 1.0 percent next year.

 

The Paris-based agency cautioned that demand for oil would remain robust in Asia, the Middle East and Latin America, fuelled by vibrant economic momentum and continued low fuel prices.

 

The IEA said global oil demand was expected to come to 87.7 million barrels a day next year. That marked an increase of 1.0 percent from the level of 86.9 million barrels a day that was forecast for 2008.

 

Demand this year was seen rising by a slight 80,000 barrels a day, according to the IEA. - AFP/de

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dunno man... situation quite tense... I'm standing by to dump all my stocks should war broke out. sweatdrop.gif

 

if it really happens, the nations involved in the six days war will want to get even with Israel this time round. dead.gif so it's gonna be a big time conflict... a lot of people getting jumpy liao.

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