Black gold prices rose above $ 123 a barrel yesterday after three sessions of declines, helped by lower U.S. dollar and expectations of the scarce supply of gasoline in the United States the largest consumer of black gold in the world.
London Brent crude rose in the nearest contract maturity of 89 cents to 123.28 dollars a barrel, recovering from the biggest daily drop in more than three weeks.
The futures rose U.S. light crude 61 cents to 103.39 dollars a barrel, after it posted the biggest drop in two days since mid-December.OPEC said yesterday that the price of its basket of crudes fell to the standard 121.57 dollars a barrel the day before yesterday from 122.25 dollars a barrel on Wednesday.
It consists of OPEC basket of 12 crude is a mix deserts of Algeria and raw Gerasol Alonjula and raw Iranian Heavy, Basra Light of Iraq and export of Kuwait and Sidr Libya and Bonny Light of Nigeria and sea country and Arab Light Saudi Murban UAE and Mary Venezuelan Orient of Ecuador.
And derives its support from black gold prices, fears of supply disruptions in the Middle East, but inhibits the rise of concerns that some Western countries use their stockpiles of black gold, which will increase supply and put pressure on prices. Investors also focused on the crisis in the euro area.
Said Turkish Energy Minister Taner Yildiz said yesterday that his country will reduce its purchases of Iranian black gold by 10%, after a week of warning Washington to Iran’s agents that they may be subject to U.S. sanctions unless diminish their purchases significantly. Yildiz told reporters that Turkey will replace its supplies from Iran, partly by million tons is expected to buy from Libya. He added that Ankara are also in talks with Saudi Arabia to buy supplies for immediate as well as long-term contracts.
And added, “We intend to increase the number of countries that buy oil.” Ankara imports about 200 thousand barrels per day of Iranian oil, which accounts for 30 percent of the total imports and more than seven percent of Iran’s oil exports.
The International Energy Agency, after a meeting of energy experts in the twenty-eight countries, members said on Thursday it was concerned by the high oil prices and is ready to move if required by market conditions.
The agency said in a statement from its Executive Director, Maria van der Hoeven, “saw the oil market in recent months, scarcity of supply for the display. And the International Energy Agency, like the others concerned about the impact of these high prices at a time when it is still fragile global economic recovery.”
The statement said he was “watching the International Energy Agency closely market developments and will remain in close contact with member countries to exchange views on market conditions. As we have said repeatedly, the agency set up to deal with any disruption of an actual supply of oil supply and we will remain ready to act if required by market conditions.”
The van der Hoeven said recently that conditions do not require the release of quantities of strategic stockpiles of oil.
It examines three members of the International Energy Agency, are the United States, Britain and France launch quantities of these stocks in a single, but others are opposed.
The Chinese government said in a statement yesterday that China will cut tariffs on some types of energy and raw materials in order to increase consumption.
He did not give the State Council further details but said that China wants to buy more of its trading partners to strengthen the local economy and raise living standards in the country. The statement said the government would cut import duties on consumer products and products of modern technology.
Iranian oil costs rise because of insurance
Sources from the insurance sector, said the ban is expected on a large scale to cover the insurance on the European Iranian oil exports from the first of July, threatened to halt shipments and raise the cost to major buyers such as Japan and South Korea.
Last week, the European Union partially relieved some insurance companies from the ban on trade in Iranian oil until the first of July and plans to EU ministers next month whether the review will extend the exemption.
And tried to Japan and South Korea to press for an exemption, but executives of freight and insurance sectors, say the ban is likely to become now.
Said Michael White, General Counsel of Intertanko, an association has its members most of the trucks in the world “exemption limited by the action represents a grace period until the first of July for a lock on a third party against legal liability and environmental liability and re-insurance is not in my view, but to delay what is inevitable.”