Oil hits new 15-month high
Oil prices rose 1 per cent today, hitting a fresh 15-month high above $83 a barrel, supported by data showing China's crude oil imports surged by nearly 25 percent in December and as the U.S. dollar weakened.
The prolonged cold snap in the U.S. and Europe continued to boost demand for heating fuel, lending support to oil prices.
U.S. crude for February delivery rose 67 cents to $83.42 a barrel, off an earlier peak of $83.67, the highest price since October 2008.
London Brent crude gained 60 cents to $81.97.
But oil is still 43 percent below its July 2008 high of more than $147 a barrel.
"The weak U.S. dollar, cold weather and robust Chinese import data are all supporting oil today," said Carsten Fritsch, oil analyst at Commerzbank in Frankfurt.
"At the moment the market is only looking at positive data, not negative numbers," he added.
China, the world's second-largest energy consumer, imported over 20 million tonnes of crude for the first time ever in December, up almost a quarter from November, according to Customs data published yesterday.
Tensions in Nigeria's main oil producing region have removed some supplies from the market, supporting prices, and traders will be watching carefully for further developments.
Chevron said on Saturday it had been forced to shut down 20,000 barrels per day (bpd) of crude oil production in Nigeria, a day after security sources said gunmen had attacked a pipeline operated by the U.S. firm.
Saudi Arabia, the world's top crude exporter, has kept February oil supply to major Asian buyers and one European major largely steady against January levels, as the kingdom takes the lead in sticking to OPEC supply cuts, industry sources said on Monday.
With little U.S. economic data this week, corporate results will be carefully watched to gauge the state of recovery in the world's largest energy consumer.
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P.Cassar
Jan 11th 2010, 18:18
What is NOT BEING SAID 20 years of PN administration has left Malta laden with BILLIONS of euros in debt. Hence when financial/ economic problems come, the PN govt have left us with no cushion at all but open to the full blown straight in the face.
E Gatt
Jan 11th 2010, 17:33
@ Simon Cassar, James Grech We agree on the Oil/W&E link but it’s incredible how many people think we live in Kuwait or some other rich oil producing country. From what I’ve read some economists are predicting an increase in the price of oil in the next few months because of an expected economic recovery whereas others say that the investment in other forms of energy (and the release of oil supplies) may lead to a fall! It is a gamble, and the premium charged for hedging increases the longer the hedge term is. Also the Country and Enemalta have financial limits to the quantities of oil they can commit themselves to. If the possibly excessive workforce at the state- controlled Enemalta was reduced we could probably enjoy lower rates. But as the country will find layoffs politically unacceptable, we are all partly to blame for this inefficiency. Renewable sources of energy are good for the environment and necessary but unfortunately the idea that this is also good for our pockets in the short term, is a bit of a myth.
James Grech
Jan 11th 2010, 17:16
Calm down Mr.N.Calleja. Miskin Gov. ux, always being blamed. Btw check my previous entry below and as you seem so sure that Gov is always in the right, please enlighten us on the questions asked or ask Gov to please explain.
Paul Smith
Jan 11th 2010, 17:13
Well said John Sammut
the price in euro's is neglible because the dollar is so weak. All commodities are traded on NYMEX in dollars.
John Sammut
Jan 11th 2010, 16:52
Oil prices go up in terms of US Dollars. When denominated in other currencies, the rises are only marginal.
James Grech
Jan 11th 2010, 16:39
@simon cassar
From what Dr. Gonzi stated in another article on this same newspaper, it seems that Gov is waiting for the opposition to come up with suitable contributions to the energy problem. Btw, Dr. Muscat did come up with a list of things to do, however Gov., as usual, buried its head in the sand and ignored this, as well as all the other plies coming from different facets of society.
N.Calleja
Jan 11th 2010, 16:14
When are all those who blame it on the government going to shut their trap? When fuel oil is reaching such high levels what is one to expect the goverment to do? Pay it out of his pockets. Although they know that the price of petrol and diesel depends on the fuel oil price they blame it 'on the Enemalta inefficiences'! They always want to have it their own way!! The opposition us comfortably sitting on the fence hitting at the government to gain the people's sympathy. But we still remember the hefty prices we paid when fuel oil was only $12 a barrel!!
James Grech
Jan 11th 2010, 15:33
Some ppl like Mr E. Gatt below are still trying to explain the irrefutable. Mr.Gatt we know this. What is important to know however is how oil is being bought i.e. by whose decision is it being hedged, seemingly when prices are high, and how much of the increase in water and electricity tariffs is effectively due to the increase in the international price of oil and how much is due to the inefficiencies that are housed by Enemalta.
Simon Cassar
Jan 11th 2010, 15:23
@ E. Gatt
Yes it is true that we dont have control over the oil prices BUT...
Who is responsible for the inefficiency in Enemalta????
What are we waiting for to use renewable sources of energy?? WHAT ARE WE WAITING FOR???? Always discussing, discussing, discussing new plans!!
Dr. Gonzi and Dr. Gatt start ACTING!!!
E Gatt
Jan 11th 2010, 14:11
It's all Lawrence Gonzi and Austin Gatt's fault that the oil prices rose to $83 a barrel!
Unbelievable but some people still cannot link the price of oil and the price we pay for water and electricity and will continue to blame the government for the increase in the price of oil.
If the price of oil continues to increase, expect even higher water and electricity rates. Dr Gonzi or Dr Muscat cannot change the fact that as an oil dependent country, Malta suffers when the world price of oil increases.
Paul Aguis
Jan 11th 2010, 13:27
So now i suppose petrol will go up, only last week it went down 1 cent. its like a merry go round here, what goes up must come down, only this time its the other way around.