1Oil Surges as UN Approves Libya No-Fly Zone; Credit Suisse Raises Forecast
Oil surged in New York after the United Nations Security Council voted to
ground Libyan leader Muammar Qaddafi’s air force as continuing unrest in
the region renewed concerns the turmoil may spread and disrupt supply.
Futures jumped as much as 2.2 percent after the UN voted to establish a no-
fly zone over Libya and demanded a cease-fire with rebels. Oil climbed 3.5
percent yesterday, the most in three weeks, after Qaddafi’s jets dropped
bombs around Benghazi while Bahraini security forces arrested opposition
leaders. Credit Suisse Group AG raised its forecast for Brent crude traded
in London, citing Middle East unrest.
“We’ve had a sharp return of risk concerns,” said Yingxi Yu, a
commodities analyst at Barclays Capital in Singapore. “The market is
starting to come to grips with the fact that we aren’t going to return to
the balance of power that’s held the Middle East together for the past 30
years. It’s going to be a much more uncertain world.”
Crude for April delivery gained as much as $2.24 to $103.66 a barrel, in
electronic trading on the New York Mercantile Exchange, and was at $103.14
at 12:16 p.m. Singapore time. Yesterday, it jumped $3.44 to $101.42, the
highest close since March 10. Prices are up 1.7 percent for the week and 25
percent higher than a year ago.
Brent crude oil for May settlement climbed $1.47, or 1.3 percent, to $116.37
a barrel on the London-based ICE Futures Europe exchange. Yesterday, the
contract advanced $4.30, or 3.9 percent, to $114.90.
Credit Suisse Group AG today upgraded its forecasts for Brent, citing unrest
in the Middle East and concerns about capacity shortfalls. The bank
increased its projection to $105.80 a barrel from $85, analysts led by
Sydney-based Sandra McCullagh said in a report. It raised its 2012 estimate
by 18 percent to $100.50 a barrel from $85. UBS AG this week advanced its
2011 forecast by 22 percent to $103.75 a barrel from $85.
Oil climbed yesterday on concern violence in Bahrain will spill into Saudi
Arabia, the world’s largest oil exporter. Forces from neighboring countries
were invited by Bahrain to help quell a month of protests driven by
majority Shiites. Regional unrest has cut Libya’s crude production and
toppled the leaders of Tunisia and Egypt.
The resolution may “result in the UN having to take military action against
Qaddafi and the prospect of that is not good for a peaceful resolution,”
Ben Westmore, a minerals and energy economist at National Australia Bank Ltd
. in Melbourne, said by telephone today. “The prospect of supply tightening
is keeping a floor under oil prices.”
State of Emergency
Bahrain declared a state of emergency on March 15 as a second contingent of
troops from Gulf nations poured into the kingdom. About 1,000 people in
Saudi Arabia’s eastern city of al-Qatif defied a ban on demonstrations and
protested peacefully on March 16 to demand the country’s troops end their
incursion into Bahrain.
“Bahrain arrested seven opposition leaders, drawing U.S. criticism and
raising fears of a regional conflict in top oil producer Saudi Arabia,”
Mark Pervan, head of commodity research at Australia & New Zealand Banking
Group Ltd. in Melbourne, said in an e-mailed note today.
The restoration of Qaddafi’s control won’t necessarily lead to the quick
resumption of Libyan oil output, analysts at JPMorgan Chase & Co. led by
Lawrence Eagles in New York said in a note to clients yesterday. It will be
difficult to persuade foreign workers to return and there may be the
obstacle of UN sanctions and a boycott of Libyan oil, the analysts said.
Libya’s oil exports may be halted for “many months” because of damage to
facilities and sanctions following a rebellion against Qaddafi, the
International Energy Agency said in its monthly Oil Market Report on March
Futures slipped as much as 1.4 percent yesterday on concern damage from the
Japanese earthquake and tsunami will curb demand for crude.
Analysts at Nomura International Ltd. said Japan’s oil demand may jump by 3
.9 percent, or 171,000 barrels a day, as the country seeks alternative power
sources. Nomura said it based its estimates on the effect of quakes in 1995
and 2007. Japan will make up for the bulk of the nuclear power losses by
boosting output in oil-fired and natural gas-fueled power plants, the bank
said in an e-mailed report.
A Tokyo Electric Power Co. official said the company may connect a power
cable to the Fukushima nuclear plant this afternoon as workers try to
restart the cooling system and prevent a meltdown. The March 11 earthquake,
Japan’s strongest on record, triggered a tsunami that has killed 6,405
people, according to the National Police Agency.
【在 k********n 的大作中提到】