Israel crisis sends oil above $78

From: clive.denton

Date: 2006-07-14 09:38:15

Here we go again, another excuse to increase the cost of oil. Thing is how much oil does Israel and Lebanon produce and contribute to the worlds oil supplies? NONE!!! The Analysts say that it is because it is creating “increased tensions in the Middle East”. The thing is that although it will push the price of our road and heating fuels up the more worrying thing is that it will also push the price of all consumer goods up as well as our weekly shopping budgets..   Clive   ============================================================ Israel crisis sends oil above $78 Growing international tension over Israel’s offensive in Lebanon has sent world markets tumbling after oil prices rose above $78 a barrel. Japanese shares fell heavily on worries over oil prices and their impact on global growth, while European markets suffered losses in early trading. In Asian trading, oil prices rose $1.40 to $78.10 a barrel, having closed at a record high of $76.70 in New York. Analysts fear the dispute could trigger wider instability in the region. Threat to growth? This, in turn, could push prices even higher. “If this carries on, you can see the oil price going to $80,” said Elissa Bayer, a director at stockbrokers Insinger DeBeaufort. A drop in US oil inventories and further tension in oil-producing Nigeria added to the upward pressure on crude prices, with Brent Crude rising $1.34 to $78.03 in Asian trading. We are certainly in unchartered territory Victor Shum, Purvin & Getz Escalating oil prices weighed heavily on stock markets, with the cost of oil seen as a threat to corporate profitability and economic growth. Japan’s Nikkei-225 index fell 252.71 points, or 1.67%, to close at 14,891.37, following the trend set by US markets which suffered badly on Thursday. The Dow Jones lost 166.89 points, or 1.5%, to close at 10,846.29, its second treble-digit loss in successive days. European markets were not immune to anxiety over conflict in the Middle East, shares falling in London, Paris and Frankfurt. The FTSE 100, Cac 40 and Dax 30 lost 38.7, 48.90 and 69.28 points respectively in early trading. $80 oil? Israel’s military action in Lebanon is one of the key factors affecting the current surge in oil prices, analysts said. Israel has imposed an air and sea blockade on Lebanon as part of a major offensive after two soldiers were seized by the militant group Hezbollah. Although neither Israel nor Lebanon are oil producers, the violence has increased tensions in the Middle East, a region which accounts for about a quarter of the world’s oil. “We are certainly in unchartered territory,” said Victor Shum, an energy analyst at Purvin & Getz in Singapore. “I would not be surprised if $80 is attained soon with this slew of geopolitical events in a tight market.” Story from BBC… Published: 2006/07/14 06:21:22 GMT avast! Antivirus: Outbound message clean. Virus Database (VPS): 0628-4, 13/07/2006Tested on: 7/14/2006 09:33:55avast! – copyright (c) 2000-2006 ALWIL Software.

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