MARKET WATCHOil prices rise upon increased resistance in Iraq

April 7, 2004
Energy futures prices rose in New York and London markets Tuesday upon concerns about escalating insurgence against US military troops in Iraq.

By OGJ editors

HOUSTON, Apr. 7 -- Energy futures prices rose in New York and London markets Tuesday upon concerns about escalating insurgence against US military troops in Iraq.

The US Pentagon said 12 Marines were killed Tuesday in an attack in Ramadi, Iraq. Meanwhile, at least another 20 American troops have died in Iraq since Saturday in battles. The fighting is part of an uprising involving both Sunni Muslims and Shiites. US commanders call it the heaviest fighting since Baghdad fell a year ago this week.

Traders also blamed market nervousness upon fears about dwindling US gasoline inventories.

Regarding the Organization of Petroleum Exporting Countries, Japan's Minster of Trade Shoichi Nakagawa told Bloomberg News that he plans to ask visiting Saudi Arabian Oil Minister Ali al-Naimi to ensure adequate crude oil supplies.

Al-Naimi is visiting Tokyo this week through Thursday. Nakagawa said he was concerned that rising crude oil prices could reduce Japan's economic growth.

Energy prices
The May contracts for benchmark US sweet, light crudes jumped by 59¢ to $34.97/bbl on the New York Mercantile Exchange Tuesday, and the June contract rose by 52¢ to $34.38/bbl. On the US spot market, West Texas Intermediate at Cushing, Okla., rose by 60¢ to $34.98/bbl.

Gasoline for May delivery advanced by 1.49¢ to $1.07/gal Tuesday on NYMEX. Heating oil for the same month gained 2.21¢ to 87.59¢/gal. The May natural gas contract rose slightly by 0.5¢ to $5.809/Mcf.

In London, the May contract for North Sea Brent crude settled 66¢ higher to $31.35/bbl on the International Petroleum Exchange.

Gas oil for April delivery gained $6.75 to $275.00/tonne Tuesday on IPE. The May natural gas contract rose by 13¢ to the equivalent of $3.76/Mcf.

The average price for OPEC's basket of seven benchmark crudes gained 32¢ to $29.90/bbl Tuesday.