LONDON, March 27: Oil prices surged on Thursday as traders worried about the prospect of a long war in Iraq as well as disruption to supplies from Nigeria because of civil unrest.

The price of reference Brent North Sea crude oil for May delivery rose by $1.23 per barrel from the previous closing price to reach $26.52 by late afternoon trading.

New York’s benchmark light sweet crude contract for May delivery was showing a gain of $1.06 to $29.69 per barrel in early trading there.

Traders took fright at warnings from US President George W. Bush that the war could drag on.

During a joint press conference on Thursday with visiting British Prime Minister Tony Blair, Bush told reporters that the conflict would last “however long it takes to win”.

“We had a significant sell-off at the initial start of the Iraqi conflict with an expectation that we wouldn’t see a significant interruption to oil supplies, and that Iraq would be back into the market very quickly, and that is probably not right,” noted analyst Jon Rigby of Commerzbank.

At the same time the market is also growing anxious about the impact of unrest in Nigeria’s oil heartland.

Nigeria shut down a fuel refinery in the troubled oil city of Warri where two weeks of violence has cut crude oil exports from the west African country by one third, officials said.

The country, Africa’s largest oil exporter with a daily production of some two million barrels, is losing around 800,000 barrels per day because of a standoff between ethnic Ijaw militants and government troops.

“Oil prices remain supported by the loss of almost 40 per cent of Opec member Nigeria’s two million barrels per day oil output because of civil unrest,” wrote analysts at commodities brokerage Sucden UK Ltd in a statement.

“Oil multinationals said they see no quick return to production in the region,” they added.

But members of the Organization of Petroleum Exporting Countries (Opec) insist they are pumping enough oil to avert supply shortfalls.—AFP