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Last Updated: Monday, 1 March, 2004, 21:02 GMT
Oil prices rise to one-year highs
Oil worker
There are fears Opec countries may restrict oil supplies
World oil prices have risen to one-year highs due to continuing concerns about the lack of stocks in the US, and instablity in major producer Venezuela.

During trading in New York on Monday, the price of Brent crude gained $1.11 a barrel to $33.34.

The rise has been fuelled by a report last week that the US was not storing enough oil ahead of the peak summer period when many drivers hit the roads.

It also comes after Venezuela said it might stop supplies to America.

Continuing pressures

That threat was made by embattled Venezuelan president Hugo Chavez, who has accused the US of supporting his protesting political opposition.

The combination of factors are forcing prices up; despite reassurances from Saudi Arabia, the world's largest oil exporter, that it would ensure adequate oil supplies.

Saudi Arabia did not comment on whether it wanted the Organisation of Petroleum Exporting Countries (Opec) to call off plans to cut output next month if prices remain high, itself another upward pressure.

Concerns the US is not stockpiling up enough oil comes from official figures from the US government's Energy Information Administration (EIA).

Llast week it warned that American oil stocks are at an almost historic low, and stores of gasoline and other oil-based products have also declined.

Stability plea

The findings of the EIA shocked the markets because at this time of year the US normally builds up its stocks ahead of the high-use period in the summer, when Americans take to the road for their holidays.

"The ongoing low level of US fuel supplies and strong demand combined with fears of Venezuelan supplies... sent prices higher," said Barclays Capital analyst Kevin Norrish.

Saudi Arabia oil minister Ali al-Nuaimi said: "It is extremely important the international oil market, certainly the consuming countries, will always feel that the major producers are constantly in dialogue to make sure that supply is sufficient, that there are no shortages."

He added: "And it is extremely important that the market remains stable."

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