Oil rises above $97 as protests in Egypt continue
The price of oil rose above $97 a barrel Monday as concerns over protests in Egypt and their possible effect on Middle East oil supplies outweighed fresh data showing a slump in China’s manufacturing sector.
By early afternoon in Europe, benchmark crude for August delivery was up 81 cents at $97.37 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 49 cents to $96.56 on Friday.
Protests in Egypt aimed at ousting Mohammed Morsi, the country’s first democratically elected president, continued Monday. Officials said at least 16 people have been killed across the country in violence connected to the rallies against the Islamist leader and the Muslim Brotherhood group which propelled Morsi to power.
Traders are concerned that the protests in Egypt and the civil war in Syria could affect the production and transport of oil supplies in the Middle East and North Africa.
“Oil could see some real volatility, as a result of the geopolitical tumult,” said the Kilduff Report, a market research paper edited by Michael Fitzpatrick. “With the protests in Egypt and reports of more strife in Libya, the geopolitical risk premium is being reflated. The battle within Syria, which is a battle for the region, is escalating still.”
Earlier in Monday’s trading session, oil prices fell to near $96 as China’s manufacturing weakened again in June amid a credit crunch and slower U.S. and European orders, two surveys showed Monday. The findings added to signs that growth in the world’s second-largest economy is decelerating.
Oil’s fall was braked by better economic news from Japan, where business confidence among major manufacturers turned positive for the first time in nearly two years, and by improving figures in the eurozone’s purchasing managers’ index.
In London, Brent crude was up 80 cents at $102.96 a barrel on the ICE Futures exchange.
In other energy futures trading on Nymex:
— Natural gas lost 2.1 cents to $3.544 per 1,000 cubic feet.
— Heating oil gained 2.76 cents to $2.8864 per gallon.
— Wholesale gasoline added 2.03 cent to $2.7359 per gallon.