LONDON, April 26: Oil prices gushed higher on Monday as traders reacted nervously to news of attempted suicide boat attacks on Iraq's main southern oil terminals which choked off exports briefly.
The price of benchmark Brent North Sea crude oil for June delivery climbed 50 cents to $33.59 per barrel in late deals here. New York's reference light sweet crude June contract rose 44 cents to $36.90 in early trading.
"Tensions in Iraq and Nigeria over the weekend are what initially pushed the market up," said GNI-Man Financial trader Lee Elliott. Three US sailors were killed in an operation that foiled an attempt by three speed boats laden with explosives from wreaking widespread damage at Iraq's key oil terminal in the southern city of Basra on Saturday night.
About 1.6 million barrels per day (bpd) are loaded through the offshore terminal, which, based on oil ministry figures, represents the bulk of Iraq's daily exports of up to 1.9 million bpd. "Supply disruptions fears still persist," said Commerzbank analyst David Thomas.
"This is not good news given that Iraq had been supplying up to 1.8 million barrels per day," he added, giving a more conservative estimate of Iraqi production than the official one.
Iraq's interim oil minister Ibrahim Bahr al-Ulum told AFP that crude exports had resumed late Sunday. "Exports have been restored to their previous levels and security measures have been reinforced in collaboration with coalition forces to protect the oil installations," he said.
Exports resumed Sunday at 1700 GMT from the Al-Basra Oil Terminal, while operations at the smaller Khor Al-Amaya resumed earlier Sunday, according to the minister. "News that tanker loadings have already resumed at the main Basra terminal have probably helped to soothe fears of any immediate major interruption to Iraq's oil exports," Barclays Capital analysts told clients.
"However the incidents do highlight the ongoing vulnerability of Iraqi oil supplies to terrorist attacks and do pose important questions over the sustainability of the recent increase in Iraqi oil production and export levels," they added. -AFP
