Oil Price Jumps In Anticipation of U.N. Resolution on Iraq
NEW YORK (AP) _ Oil prices rose sharply Monday on perceptions that the U.N. Security Council soon would approve a military strike to push Iraqi troops out of Kuwait.
But the future finished off its peak as traders sold crude to take profits from a third straight run-up on the New York Mercantile Exchange.
Light sweet crude for January delivery settled at $32.95 per barrel, up $1.05.
Oil had shot up more than $2 per barrel in early trading, to a price about $5 higher than at the close last Tuesday, before peaking at $34.25.
The jump came early as traders responded to statements from U.S. officials that the U.N. Security Council was likely to approve a resolution this week authorizing the use of force to get Iraq out of Kuwait. The military action would be allowed if Iraqi President Saddam Hussein does not withdraw his troops by Jan. 1, officials said.
″People saw that as being quite bullish,″ said Stephanie Rzasa, a broker with Dean Witter Reynolds Inc. ″This is making the thought of war even more real.″
During the early surge, broker Brian Tagler of Shearson Lehman Brothers Inc. said the market was ″rocking and rolling″ on the renewed war fears.
The possibility that a U.N. resolution would contain a deadline seemed particularly bullish, he said.
But the price fell back as traders sensed it would go no higher.
″It seemed like a logical place to come in and take profits,″ Rzasa said.
Oil’s rise on Monday followed back-to-back rallies that sent crude $2.27 per barrel higher in the last session and 72 cents higher the session before that.
Futures contracts for refined petroleum products have also risen.
On Monday, home heating oil was up 3.72 cents to 92.38 cents a gallon for December delivery, while unleaded gasoline for December was up 1.80 cents a gallon, to 84.20 cents.
Later contract months were all higher for crude, heating oil and gasoline.
Natural gas for delivery in January was up 1.3 cents to $2.618 per 1,000 cubic feet.