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Oil prices rise following attack in Nigeria

Oil prices rise following attack in Nigeria

Oil prices rose Tuesday after gunmen in Nigeria kidnapped six foreign oil workers and killed a Nigerian sailor on a Chevron Corp. ship.
Capt. Obiora Medani said the sailor was a guard aboard the Chevron ship FPSO Oloibiri, which was attacked off Bayelsa state in the oil-rich south of the West African country.
"This incident has once again highlighted the instability in the region, with the country's output still below full capacity and the most recent presidential elections have only made the situation worse," said Michael Davies, an analyst at Sucden in London.
A spokesman for California-based Chevron told Dow Jones Newswires that it had shut down 15,000 barrels a day of oil production because of the attack. The spokesman said four Italians, one American and one Croatian were abducted. Italy's Foreign Ministry also said four Italian technicians were among the kidnapped.
In a separate incident, gunmen seized the mother of the newly elected governor of neighboring Rivers state, police said.
Light, sweet crude for June delivery rose 1 cent to US$65.72 a barrel in electronic trading on the New York Mercantile Exchange by midday in Europe.
In New York trading on Monday, prices fell 75 cents to settle at US$65.71, while gasoline prices rose on reports of another series of U.S. refinery problems.
Brent crude for June on London's ICE Futures exchange was up 13 cents to US$67.78 a barrel.
Heating oil futures rose 0.14 cent to US$1.8962 a gallon on the Nymex, while natural gas fell 4.8 cents to US$7.815 per 1,000 cubic feet.
Analysts attributed some of Monday fall in oil prices to profit-taking from Friday's big rally, when crude surged above US$66 a barrel after Saudi Arabia announced the arrests of 172 Islamic militants, some of whom allegedly planned to attack oil fields.
Refinery problems in the United States put more pressure on gasoline inventories, which have fallen for 11 weeks in a row. Last week's U.S. Energy Department report showed an unexpected drop of 2.8 million barrels in U.S. gasoline stockpiles and said U.S. refinery use declined to 87.8 percent of capacity.
With the start of the summer driving season about a month away, some analysts wonder whether gasoline supplies will be adequate to meet demand.
"Although recent refinery runs have been on the low side, the real problem may not be a spike in unplanned plant outages, of which there is no compelling evidence, but rather the failure of U.S. refining capacity to keep up with consumption growth," said Antoine Halff, an analyst at Fimat. "As a result, U.S. dependency on gasoline imports has shot up, at a time when the latter's availability has itself come under pressure."


Updated : 2021-07-25 18:54 GMT+08:00