New York City -
Oil prices edged higher on Friday driven by worries over more unrest in Egypt, which sits astride the key Suez Canal and Sumed pipeline conduits for oil flowing from the Gulf.
In New York the benchmark WTI crude for September delivery added 13 cents to end at $107.46 a barrel.
In London, Brent North Sea crude for delivery in October finished at $110.40 a barrel, up 94 cents.
Lee Chen Hoay, investment analyst at Phillip Futures., said the gains came “on worries that escalating violence in Egypt could impact the oil shipment along Suez Canal or spread across the Middle East, where supplies already face disruptions.”
Although Egypt is not a major oil producer, the Suez canal carries about 2.5 million barrels daily, about 2.7 percent of global supply, with much of it destined for European markets.
Michael McCarthy, chief market strategist at CMC Markets in Sydney, said that oil prices already included a “risk premium” as investors grow accustomed to constant threats of a disruption in Middle East supply.
“Egypt is clearly having an impact on prices, but the reality is constant talk of a Middle East supply disruption has almost become background noise for investors,” he said.
The downgrade of the mid-Atlantic storm Erin to a tropical depression removed some worries it had the potential to grow into a hurricane that could threaten oil industry operations and traffic as it tracks toward the US east coast. - Sapa-AFP