Oil climbs back above $143

Robert Cookson
Financial Times
Friday, July 11, 2008

Oil prices remained on the up, climbing back towards record levels as strike threats and deepening geopolitical tensions raised fears over the safety of supplies.

Having rallied more than 4 per cent overnight from Thursday’s two-week low of $135.43, Nymex West Texas Intermediate rallied a further 1.2 per cent, or $1.70, to $143.35 a barrel. Brent crude made a similar move, and on Friday, was up $1.70 to $143.73 a barrel.

A union of employees from Petrobras, the Brazilian state-controlled oil company, in the Campos basin – where 80 per cent of Brazil’s oil is produced – said that they would shut down rigs to press for better pay.

When Petrobras employees refused to work for five days in 2001, oil production fell sharply and Brazil had to import extra oil. However, since then Petrobras and the unions have resolved their disputes without severe stoppages.

Oil also got a boost from news that the main militant group in Nigeria’s oil-rich Niger Delta was abandoning a ceasefire in response to Britain’s offer to help tackle lawlessness in the area.

Militants have helped cut Nigeria’s oil exports by more than 20 per cent since 2006 by attacking pipelines and other installations.

Full article here

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