LONDON, Oct 24: The price of oil edged higher on Thursday as traders awaited the outcome of United Nations Security Council discussions on Iraq which began a day earlier.
The price of benchmark Brent North Sea crude for December delivery traded for $26.55 a barrel here against $26.51 at the end of the previous session, just above Tuesday’s two-month low.
In New York, light sweet crude December-dated futures rose six cents to $28.24 per barrel.
The rise in prices came as Russian Deputy Foreign Minister Yury Fedotov said a modified US draft resolution on Iraq presented to Security Council members still did not meet Russian objections.
“(The draft) has been modified but clearly does not meet the criteria set by Russia,” ITAR-TASS news agency reported Fedotov as saying.
Barclays Capital analyst Kevin Norrish said prices had risen because of “a change in the way the market is viewing the issue of Iraq.”
“Whereas earlier in the week the market reacted to what were perceived as conciliatory comments from the US on the issue... now things have swung back the other way, after indications that the US is perhaps losing patience with the UN,” he said.
GNI analyst Lawrence Eagles added that the market seemed to be taking the increased tensions at the United Nations “more seriously”.
“It feels there is a real risk that international cooperation against Iraq could be compromised.”
Eagles said the perceived increased risk of the United States launching unilateral action “has greater risks for the oil price,” since such an outcome would be viewed less favourably for by the Arab world.—AFP
