Oil prices rise on geopolitical concerns

The sweeping ISIS offensive prevented Baghdad from exporting oil via a pipeline to Turkey and by road to Jordan

Published: Updated:
Read Mode
100% Font Size
2 min read

Oil prices were mixed in Asia Friday as dealers focused on conflict-wracked Ukraine and U.S.-led airstrikes against jihadists in the Middle East, analysts said.

U.S. benchmark West Texas Intermediate for November delivery rose three cents to $92.56 while Brent crude for November eased seven cents to $96.93 in mid-morning trade.

“Oil prices are seeing an uptick mainly as a function of geopolitical risk,” Ric Spooner, chief market analyst at CMC Markets in Sydney, told AFP.

“Developments in Ukraine and the situation with the U.S. bombings in Syria and Iraq are on investors’ minds,” he added.

The European Union (EU) will hold fresh talks with Russia and Ukraine later Friday in Berlin to settle their ongoing dispute over gas deliveries.

Europe gets more than 30 percent of its gas from Russia, with half of that transiting through Ukraine.

In June, Moscow cut off supplies for Kiev owing to a bitter price dispute that took place against the backdrop of an armed insurgency by pro-Kremlin rebels in east Ukraine.

Gas is flowing as normal through Ukraine into the EU, but Russia has warned there is a high risk of disruption of deliveries to Europe this winter as international tensions remain high over the Ukraine crisis.

Crude investors are also keeping watch as the U.S. and its Arab allies turn up the heat on the Islamic State of Iraq and Syria group, striking oil facilities funding their uprising.

ISIS has overrun large swathes of Iraq and Syria and declared a “caliphate” in those areas.

The sweeping jihadist offensive began on June 9, preventing Baghdad from exporting oil via a pipeline to Turkey and by road to Jordan.

A three-year civil war in Syria between the government and insurgents including IS has seen its crude exports dip to around 25,000 barrels a day from 400,000 in 2010.

Top Content Trending