Terror fears drive oil prices to new high
Global oil prices have hit a new high at $US64 a barrel.
Supply Chain Reveiw | August 9, 2005
News agencies have attributed the price peak to warnings of imminent terror attacks against Westerners in Saudi Arabia.
The Australian Department of Foreign Affairs has issued a warning to Australians to avoid travel to the kingdom, saying militants might be planning attacks on housing compounds.
"We have received credible reports that terrorists are planning attacks in Saudi Arabia in the near future," the department says via its website.
"This follows other recent reporting suggesting that terrorists may be planning to attack residential housing compounds in Saudi Arabia."
Last month, the US warned Americans in Saudi Arabia militants were planning fresh attacks, and later banned military personnel from travelling around the kingdom.
The US embassy warning was the second in two weeks, and cautioned Americans militants were probably plotting new attacks.
Concerns over possible terrorist attacks in Saudi Arabia were exacerbated by the news that yet another US refinery had run into production problems, fuelling speculation that the world's largest economy could run short of gasoline.
The security warnings, combined with worries the United States may face a gasoline shortage, helped propel oil prices to another record high.
Terror concerns drive oil price toward $65
Xinhuanet | August 9, 2005
Warnings of a possible terrorist attack in Saudi Arabia coupled with concerns about Iran's resumption of its nuclear program helped push crude prices to nominal records, with analysts fearing the per barrel price could soon breach 65-US dollar mark, the Financial Times reported Tuesday.
Crude futures in New York on Monday approached 64-dollar a barrel and US gasoline futures reached highs as an already-tight market reacted to warnings from the United States, Britain and Australia of potential attacks in Saudi Arabia, the world's biggest oil producer.
Britain talked of "credible reports" that terrorists were in the "final stages of planning attacks" in the kingdom, a warning that was echoed by the Australian government and came as the United States closed its missions in Saudi Arabia, also citing a terrorist threat.
The futures market has been driven higher by one of the worst sequences of refinery stoppages in years.
Prices were also lifted by Iran's resumption of nuclear activities at a uranium conversion plant in Isfahan -- a move thatbrings Tehran closer to threatened United Nations sanctions.
The International Atomic Energy Agency will hold an emergency meeting of its board of governors on Tuesday to discuss Iran's decision.
Oil traders fear Iran's resumption of its nuclear program couldprompt the European Union to back US calls for sanctions against the second-biggest oil producer in the Organisation of the Petroleum Exporting Countries.
Meanwhile, lack of spare capacity means refineries could face difficulties meeting global oil demand this winter.
The International Energy Agency, the industrial countries' energy watchdog, has forecast that oil consumption will reach 85.9-million barrels a day in the fourth quarter, up from the current 83.7 million. Enditem
Last modified August 14, 2005