News Column

IRAQ OIL SUPPLY FEARS FORCE UP PRICES

June 14, 2014

By Rob Davies, Daily Mail, London



June 14--OIL prices rose for a third day, as Sunni extremists marched toward the Iraqi capital Baghdad, threatening supply.

Brent crude, the global benchmark, neared $115 a barrel, before settling down to $113.34.

Prices rose with a surge in violent conflict in Iraq, the world's seventh-largest oil producer and the second-biggest in the Opec cartel of oil-producing nations.

The ISIS insurgency has focused on the north of the country, but oil traders are worried that the terror group will turn its attention to the oil-rich south.

Concerns have also been raised by a 90pc drop in production in Libya, where protests about oil revenue have disrupted output.

'This is happening at a critical time for Opec as it is already struggling to meet its production target of 30m barrels a day,' said analysts at Saxo Bank. Iraq has vowed to increased production from 3.3m barrels a day to 4m by the end of the year and 7m by 2016.

But Saxo said: 'The current fighting will make it close to impossible to develop untapped resources in the northern and eastern parts of the country.'

Turmoil in Iraq has also weighed on oil firms in the semi-autonomous Kurdistan region of northern Iraq, such as former BP boss Tony Hayward'sGenel Energy (up 0.5p to 972p).

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(c)2014 Daily Mail (London, )

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Distributed by MCT Information Services


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Source: Daily Mail (London, England)


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