Oil prices rise to almost $63 a barrel | VailDaily.com

Oil prices rise to almost $63 a barrel

LONDON – Crude futures rose Thursday as traders focused on output disruptions in Nigeria and other geopolitical threats to supplies.Light sweet crude for April delivery rose 98 cents to $62.95 a barrel on the New York Mercantile Exchange. Brent crude for April was up 79 cents at $63.24 a barrel on London’s ICE Futures exchange.Gasoline futures rose more than 6 cents to $1.6825 a gallon (3.8 liters), while heating oil futures gained by more than 4 cents to $1.7875 a gallon. Natural gas fell 7 cents to $6.66 per 1,000 cubic feet.Crude oil prices continue to be supported by supply fears tied to Iran’s standoff with the international community over its nuclear program and recent militant attacks on the oil industry in Nigeria.European and Iranian negotiators were meeting this week in a new effort to defuse tension over Tehran’s insistence on running a program the U.S. and Europe fear could be used to make nuclear weapons.The meetings come three days ahead of an International Atomic Energy Agency board meeting. The board’s recommendation to the U.N. Security Council, which has the power to impose sanctions, will likely help determine its immediate course of action on Iran.On Wednesday, Nigerian militants released six of the nine foreign oil workers taken hostage on Feb. 18. The militants, who want a greater share of oil wealth, also threatened new attacks aimed at cutting off all oil production in Nigeria.Edmund Daukoru, Nigerian oil minister and president of the Organization of Petroleum Exporting Countries, said once the hostages are released 75 percent of the lost production can be resumed within two weeks.Attacks on the oil industry in the Niger Delta had already shut down 455,000 barrels per day in crude production, nearly 20 percent of the country’s daily output of 2.5 million barrels per day.Those factors were overshadowing a weekly supply report from the U.S. Department of Energy saying domestic oil inventories grew by 1.6 million barrels last week to 328.3 million barrels, or 9 percent above year-ago levels.Gasoline inventories rose 300,000 barrels to 225.9 million barrels, putting them marginally above year ago levels.The nation’s supply of distillate fuel, which includes diesel and heating oil, declined by 1.5 million barrels to 134.1 million barrels, or 14 percent higher than a year ago.Demand is healthy around the world and oil supply is good, but the political side is what is keeping the market so strong, said Rob Montefusco, trader with Sucden Commodity Brokers.Daukoru said Wednesday he sees no problem with prices above $60 a barrel so long as the global economy continues to grow. “A fair price is what the market can sustain.”However, when prices approach $70 a barrel “everybody gets nervous,” Daukoru said.He declined to speculate on whether the cartel would curtail production at its meeting next week in Vienna, but said he was concerned about an “overhang” of supply.Vail, Colorado

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