World oil prices rose on Friday as the hospitalization of Saudi King Fahd unsettled markets already skittish about demand at the start of the US summer driving season.
New York's main contract, light sweet crude for delivery in July, climbed US$0.84 to US$51.85 per barrel in closing deals.
In London, the price of Brent North Sea crude oil for delivery in July gained US$0.54 to US$50.70 per barrel.
PHOTO: AP
King Fahd's hospitalization left markets nervous about events in the world's largest oil producer, which has pledged to boost production to meet surging global demand.
"Prices rose rose on short covering ahead of the week-end but then came the news that King Fahd had been brought to a hospital," which accelerated the buying, said Fimat USA analyst John Kilduff.
If Fahd were to die over the weekend, that would likely boost prices because of the "uncertainty in the major oil producer in the Middle East," he added.
Seth Kleinman of PFC Energy said the news from Saudi Arabia had an impact but "we had a strong week" for oil prices as a disappointing report on US stockpiles prompted buyers to bid up prices.
"The fundamentals have changed a lot," he said.
Prices had closed more than a dollar higher on Wednesday when a US government survey showed a surprise drop in inventory levels of crude oil, which refineries turn into gasoline.
The US summer holiday driving season, which sees many Americans taking to the open roads in their vehicles, officially begins this weekend ahead of the Memorial Day holiday.
"Some of the gains seen this week have also been in preparation for the long weekend," Investec analyst Bruce Evers said.
The US Energy Department said Wednesday that US crude inventories fell 1.6 million barrels in the latest week, against market expectations for an increase.
But at 332.4 million barrels, stocks remained well above the upper end of the average range for this time of year.
The report also showed gasoline stockpiles rising 600,000 barrels to 215.4 million, in line with most forecasts.
"With the product inventories still bearish the market may struggle to break any higher unless we see some bullish fundamental news," analysts at the Sucden brokerage firm said.
"Crude stocks are still over 10 percent above year-ago levels and OPEC looks likely to continue almost flat-out crude production."
The Organization of Petroleum Exporting Countries is producing in excess of 30 million barrels per day, a figure that is close to 25-year high points.
Tetsu Emori, chief commodities strategist at Mitsui Bussan Futures in Tokyo, said US gasoline stockpile levels were stable, allowing prices to ease below US$50 per barrel next week.
"I think there's a possibility of prices going down rather than going up," he said. "I don't think the gasoline market is tight, it's stable," he said, adding that US refineries were capable of meeting demand during the summer driving season.
TRADE WAR: Tariffs should also apply to any goods that pass through the new Beijing-funded port in Chancay, Peru, an adviser to US president-elect Donald Trump said A veteran adviser to US president-elect Donald Trump is proposing that the 60 percent tariffs that Trump vowed to impose on Chinese goods also apply to goods from any country that pass through a new port that Beijing has built in Peru. The duties should apply to goods from China or countries in South America that pass through the new deep-water port Chancay, a town 60km north of Lima, said Mauricio Claver-Carone, an adviser to the Trump transition team who served as senior director for the western hemisphere on the White House National Security Council in his first administration. “Any product going
High above the sparkling surface of the Athens coastline, the cranes for building the 50-floor luxury tower centerpiece of Greece’s future “smart city” look out over the Saronic Gulf. At their feet, construction machinery stirs up dust. Its backers say the 8 billion euro (US$8.43 billion) project financed by private funds is a symbol of Greece’s renaissance after the years of financial stagnation that saw investors flee the country. However, critics see it more as a future “ghetto for the rich.” It is hard to imagine that 10km from the Acropolis, a new city “three times the size of Monaco”
STRUGGLING BUSINESS: South Korea’s biggest company and semiconductor manufacturer’s buyback fuels concerns that it could be missing out on the AI boom Samsung Electronics Co plans to buy back about 10 trillion won (US$7.2 billion) of its own stock over the next year, putting in motion one of the larger shareholder return programs in its history. South Korea’s biggest company would repurchase the stock in stages over the coming 12 months, it said in a regulatory filing on Friday. As a first step, it would buy back about 3 trillion won of paper starting today up until February next year, all of which it would cancel. The board would deliberate on how best to effect the remaining 7 trillion won of buybacks. The move
In a red box factory that stands out among the drab hills of the West Bank, Chat Cola’s employees race to quench Palestinians’ thirst for local products since the Gaza war erupted last year. With packaging reminiscent of Coca-Cola’s iconic red and white aluminum cans, Chat Cola has tapped into Palestinians’ desire to shun brands perceived as too supportive of Israel. “The demand for [Chat Cola] increased since the war began because of the boycott,” owner Fahed Arar said at the factory in the occupied West Bank town of Salfit. Julien, a restaurateur in the city of Ramallah further south,
RSS