AFP reported that world oil prices paused at the end of a volatile week in which simmering tensions in the Middle East and North Africa sent the market to 2 year peak above USD 104 per barrel.
Brent North Sea crude for delivery in April rose nine cents to USD 102.68 per barrel in early afternoon deals as traders also shrugged off news of fresh monetary tightening in China. New York's main contract light sweet crude for March, slipped 15 cents to USD 86.21.
Ms Soozhana Choi analyst of Deutsche Bank said that "As anti government protests have spread from Tunisia and Egypt to the streets of Bahrain, Yemen and OPEC member countries Algeria, Libya and Iran, concerns about geopolitical risk and the potential for supply disruptions have returned aggressively to the global oil market."
Ms Choi said that while disruptions have not been reported thus far, immediate market fears centre on the fact that these five countries Bahrain, Yemen, Algeria, Libya and Iran represent 10% of global crude oil production.
Financial markets were additionally worried by Iran's reported efforts to send naval ships into the Mediterranean. Demonstrators in various Arab states have drawn inspiration from pro democracy protests that led to the recent oustings of leaders in both Tunisia and Egypt.
A local hospital source said that 14 people were killed in clashes between security forces and anti-government protesters in Libya's second city Benghazi. Elsewhere, Angry Bahraini Shiites buried four killed in a violent police raid on anti regime protesters as the army enforced a tight clamp across the capital of the Sunni ruled Gulf monarchy.
In Algeria, meanwhile, senior former regime leader Mr Abdelhamid Mehri urged President Mr Abdelaziz Bouteflika to implement sweeping political changes as pro-democracy protests took root in the country.
Ms Choi at Deutsche Bank said that beyond the immediate fears, more far reaching concerns are that the unrest in these countries could spread to their neighbors which represent a far larger share of global oil production. The Middle East alone represents 30% of global crude oil production including North Africa the region combined represents 35% of global crude oil production.
(Sourced from AFP)
