LONDON, March 10: World oil prices extended gains on Friday as the market tracked events in Iran amid fears that the country could cut its crude exports if hit by economic sanctions over its nuclear programme.

New York’s main contract, light sweet crude for delivery in April, rose 11 cents to $60.58 per barrel in electronic deals before the official opening of the market.

In London, the price of Brent North Sea crude for April delivery gained 21 cents to $61.27 per barrel.

Crude futures had rebounded by more than a dollar in London on Thursday, a day after plunging on news of ample US energy supplies and an Opec decision to keep pumping oil at a near 25-year high.

Despite the oversupply of oil and Opec’s decision not to cut production, the markets remain on edge over Iran’s disputed nuclear programme, which is expected to be discussed by the UN Security Council next week, analysts at the Sucden brokerage firm said in London.

Western powers led by the United States want to curb Iran’s nuclear activities amid fears that the country is aiming to develop nuclear weapons. Tehran has insisted that its research is for peaceful purposes.

A defiant Iranian President Mahmoud Ahmadinejad declared Thursday that “the time for bullying is over” and that the West “can not do a damn thing” against his country.

Iran is the fourth-biggest oil producer in the world.

The market is reacting to some rhetoric regarding the Iranian situation, said Victor Shum, a Singapore-based analyst with US energy consultancy Purvin and Gertz.

If market fundamentals of supply and demand are considered, prices should be going down, Shum said, referring to US crude oil reserves which are about 10 percent higher than at the same stage a year ago and are at their highest level since May 1999.

The Organization of Petroleum Exporting Countries (Opec) meanwhile had decided Wednesday to keep output at a near 25-year high of 28.0 million barrels per day (bpd).

The European Union vowed Friday to press on with efforts to seek a diplomatic solution to the Iran nuclear crisis, which it still believes is possible despite this week’s escalation of the standoff.—AFP