BUSINESS

Oil prices rise above $92 in Europe amid increased Turkish-Syrian tensions

10/11/2012 08:42 EDT | Updated 12/11/2012 05:12 EST
The price of oil rose above US$92 a barrel Thursday as growing tensions between Turkey and Syria caused worries about the future of Middle East crude supplies.

By early afternoon in Europe, benchmark West Texas Intermediate crude for November delivery was up 90 cents at US$92.15 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.14 to finish at $91.25 per barrel on the Nymex on Wednesday after some mixed economic signals.

Brent crude, used to price international varieties of oil, rose 86 cents to US$115.19 on the ICE Futures Exchange in London.

Turkish jets on Wednesday forced a Syrian passenger plane to land at Ankara airport on suspicion that it might be carrying weapons or other military equipment to support the regime of President Bashar Assad in its civil war against Syrian rebels.

Escalating tensions between the two former allies are "one of the things that are keeping oil prices somewhat firm to stronger," said Ric Spooner, chief market analyst at CMC Markets in Sydney.

Many observers fear the civil war in Syria could grow into a wider regional conflict that could threaten oil supplies from Middle East producers. The Middle East and North Africa account for about a third of global oil production.

A softer dollar helped lift oil prices by making crude cheaper for investors trading in other currencies. On Thursday, the euro was up to US$1.2922 from $1.2847 late Wednesday in New York.

Investors will also be monitoring fresh information on U.S. stockpiles of crude and refined products. Data for the week ended Oct. 5 are expected to show a rise of 1.5 million barrels in crude oil stocks, while gasoline stocks are expected to remain unchanged, according to a survey of analysts by Platts, the energy information arm of McGraw-Hill Cos.

The report from the Energy Department's Energy Information Administration will be out later Thursday.

In other energy trading on the New York Mercantile Exchange, heating oil rose 2.69 cents to US$3.24 a U.S. gallon (3.79 litres), wholesale gasoline was down 0.57 cent at US$2.9536 a gallon and natural gas added 0.5 of a cent to US$3.48 per 1,000 cubic feet.

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