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Supply fears push oil higher
Thu Apr 5, 2012 7:55am EDT
By Ikuko Kurahone
LONDON, April 5 (Reuters) - Oil prices edged up on Thursday, after two days of losses, supported by concerns over disruptions to Iranian oil supplies due to nearing Western sanctions.
In a move that could seriously complicate Iran's oil exports after a European Union embargo comes into force on July 1, a major Chinese ship insurer will halt indemnity cover for tankers carrying Iranian oil, sources told Reuters.
Brent crude oil futures rose 33 cents to $122.67 a barrel by 1152 GMT and U.S. crude gained 48 cents to $101.95. Trading volumes were moderate for both contracts ahead of Easter public holidays in Europe and the United States.
Oil prices have fallen by $3 per barrel over the last two sessions together with other risk assets amid fading expectations for more monetary stimulus from the United States and due to an increase in U.S. oil inventories.
"The stock market and oil both moved lower yesterday. Oil is recovering because of geopolitical risk over the long weekend," said Christopher Bellew, broker with Jefferies Bache.
China is the top buyer of Iranian crude and the insurance move is the first sign Chinese refiners may struggle to obtain the shipping and insurance they need to keep importing from OPEC's second-biggest producer.
Industry sources earlier told Reuters Japanese refiners planned to cut crude imports from Tehran yet again in April as they shy away from renewing annual contracts.
"The situation regarding Iranian crude exports is getting more and more complicated as U.S. and EU sanctions are starting to have an ever bigger impact," said David Wech from JBC Energy.
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Thu Apr 5, 2012 7:55am EDT
By Ikuko Kurahone
LONDON, April 5 (Reuters) - Oil prices edged up on Thursday, after two days of losses, supported by concerns over disruptions to Iranian oil supplies due to nearing Western sanctions.
In a move that could seriously complicate Iran's oil exports after a European Union embargo comes into force on July 1, a major Chinese ship insurer will halt indemnity cover for tankers carrying Iranian oil, sources told Reuters.
Brent crude oil futures rose 33 cents to $122.67 a barrel by 1152 GMT and U.S. crude gained 48 cents to $101.95. Trading volumes were moderate for both contracts ahead of Easter public holidays in Europe and the United States.
Oil prices have fallen by $3 per barrel over the last two sessions together with other risk assets amid fading expectations for more monetary stimulus from the United States and due to an increase in U.S. oil inventories.
"The stock market and oil both moved lower yesterday. Oil is recovering because of geopolitical risk over the long weekend," said Christopher Bellew, broker with Jefferies Bache.
China is the top buyer of Iranian crude and the insurance move is the first sign Chinese refiners may struggle to obtain the shipping and insurance they need to keep importing from OPEC's second-biggest producer.
Industry sources earlier told Reuters Japanese refiners planned to cut crude imports from Tehran yet again in April as they shy away from renewing annual contracts.
"The situation regarding Iranian crude exports is getting more and more complicated as U.S. and EU sanctions are starting to have an ever bigger impact," said David Wech from JBC Energy.
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