Oil climbs above $100 in Asia amid Iran tensions

KUALA LUMPUR, Malaysia — Oil climbed above $100 a barrel today in Asia after Saudi Arabia, the world’s largest exporter of the commodity, indicated it thinks prices should be maintained around that level.

Benchmark crude for February delivery was up $1.94 at $100.63 a barrel at midday Kuala Lumpur time in electronic trading on the New York Mercantile Exchange. The oil market in the U.S. was closed on Monday for a holiday.

Oil prices rose after Saudi Oil Minister Ali al-Naimi told CNN that Saudi Arabia wanted to stabilize prices at $100 a barrel this year and was ready to pump more oil if needed, said Victor Shum, an energy analyst with Purvin & Gertz in Singapore.

But the minister’s comments also raised new tension as Iran has warned Gulf nations not to make up any shortfall due to U.S.-led sanctions that are hampering its crude exports, Shum said. Iran has warned it would respond to an embargo by shutting the Strait of Hormuz which is used to transport about a fifth of the world’s oil.

“There is more upside to oil pricing primarily because of geopolitical supply side concerns,” Shum said.

Crude’s gains were in sync with Asian stock markets after a successful bond auction by France eased jitters over Europe’s debt crisis after Standard and Poor’s downgraded the government debt of nine countries that use the euro, he said.

Shum said Europe’s continuing crisis would spark volatility in oil prices but predicted crude could stay above $100 a barrel in the medium-term. Slowing growth in China, a major oil consumer, could also dampen sentiment, other analysts said.

The world’s second-largest economy grew 8.9 percent in the last quarter of 2011, the weakest expansion since mid 2009 but still robust enough to suggest the country will avoid an abrupt slowdown.

In other energy trading, heating oil rose 5.8 cents to $3.09 per gallon and gasoline futures rose 5.3 cents to $2.79 per gallon. Natural gas fell 12.2 cents to $2.55 per 1,000 cubic feet.

18 Comments

  1. sammy

    Everytime someone farts the price of oil goes up but never goes down.

    #1
  2. outsidelookingin

    Excuses comes in all shapes and forms.

    #2
  3. Alex

    A fifth of the World’s oil export causes this much uproar?

    #3
  4. onefluff

    GREAT, because I just moved to LA. Gas prices here went from just under $3.70 for premium to around $3.90 in 10 or so days. Also, grocery store food prices are expected to rise 4 percent and restaurant prices 2 percent this year. Freakin awesome.

    #4
  5. onefluff

    GREAT, because I just moved to LA. Gas prices here went from just under $3.70 for premium to around $3.90 in 10 or so days. Also, grocery store food prices are expected to rise 4 percent and restaurant prices 2 percent this year. Awesome.

    #5
  6. Mayflower Girl

    The System is definately broken. Stop the BS! Vote for Ron Paul to keep us at peace with the world so the oil companies can’t use it as an excuse.

    Ron Paul 2012 – for real change in the US!

    #6
  7. TheReal Rick

    We will be praying for $100 a barrel gas after the war starts.

    #7
  8. Mikey

    Your first mistake was moving to LA from Houston. Most people are moving from LA to Houston.

    #8
  9. Hank

    Any ol’ excuse. Let all the speculators be strung up with a short rope.

    #9
  10. Mikey

    The World needs to come down on Iran’s butt and show them where they really are in the pecking order.

    #10
  11. Ogre 1

    Any excuse to raise the price of oil. Panicky bloody sheep.

    #11
  12. onevois

    a price increase ahead of an empty threat has nothing to do with supply and demand. opec is a self-serving monopoly.

    #12
  13. Trail_Tramp

    The only thing between us and $200/bbl oil is a hair-trigger in the Strait of Hormuz.

    #13
  14. Don Y

    The traders and traitors just love this.

    #14
  15. For the Better Good

    For goodness sake, America, start controlling your usage of fuel. When you fail to consider and control your consumption and purchase of fuel – in other words, every time you fill-up your vehicle with gas – you are essentially telling Saudi Arabia and all the other OPEC nations that you are okay with paying upwards of $3++++++ for gasoline. Quit burning and wasting fuel like it’s always going to be in plentiful supply. When overall demand goes down, prices will adjust themselves to affordable prices. It will never be cheap again but we can help drive the prices down from what they currently are.

    #15
  16. Trail_Tramp

    From the blog site of a former military intelligence officer: “Iran doesn’t need to win a protracted struggle with American forces to effectively close the Strait of Hormuz. Once the first tanker hits a mine, or is struck by a missile, insurance underwriters will stop issuing coverage for commercial traffic in the region, reducing the flow of crude to a trickle…Even a brief interruption in oil traffic through the strait would send prices skyrocketing towards the $200 level…”

    #16
  17. jakz

    If we had a president with a sane energy policy, we would not be at the mercy of OPEC or any other entity. Obama’s advice is to go green, and attack energy companies as though they are the root of all evil while he and his luxury loving wife use oil abundantly.

    #17
  18. cobiamike

    @ For the Better Good :
    Do you have any REAL suggestions or are you just good for platitudes and wishes?
    How the heck are we to get from point A -B ?

    #18