Page last updated at 19:43 GMT, Tuesday, 22 April 2008 20:43 UK

Oil jumps to near $120 a barrel

Oil traders on the floor of the New York Mercantile Exchange
A state of panic has taken over the oil markets, analysts say

Oil prices have touched fresh highs as traders bet that violence in key producing nations will hurt supply.

US light, sweet crude rose as high as $119.90 a barrel, before closing at $119.37. London's Brent crude peaked at $116.75 a barrel.

The rises were supported by fears of further attacks on pipelines in Nigeria and oil cartel Opec's refusal to raise quotas to curb rising prices.

Comments that it will raise production in 2012 failed to dampen sentiment.

"Again there are some concerns over supply disruptions in Nigeria," said David Moore, commodities strategist at Commonwealth Bank of America.

Attacks on Royal Dutch Shell's pipelines there last week led to a drop in production of about 169,000 barrels per day for shipments in April and May.

As a result, the company said it would be unable to honour its contractual obligations at the Bonny terminal in Nigeria's Delta region for these two months.

Anti-government attacks on the region's oil infrastructure have been escalating for the past few years.

Opec stance

The continued oil rally was supported by Opec secretary general Abdalla Salem el-Badri's stance that real demand was being well matched by current supply with no immediate need to lift production levels before 2012.

Then, the producers' group would boost capacity by five million barrels a day.

He said he did not expect to discuss whether prices were too high or too low at an energy forum in Rome attended by government ministers and oil firm bosses.

"The oil futures market is very strong, but the physical markets are not so strong," said Ehsan ul-Haq, head of research at consultancy JBC Energy.

The BBC is not responsible for the content of external internet sites

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Sign in

BBC navigation

Copyright © 2018 BBC. The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific