Oil - Brent crude rallies as Nigerian oil union threaten to join strike 03.07.2003 11:52 Headlines
LONDON (AFX) - Brent crude oil prices rallied in midmorning trade on fears
of supply disruption after reports that the Nigerian oil sector unions are to
join in a nationwide general strike, analysts said.
At 10.46 am, August-dated Brent crude futures were up 54 cents at 28.51 usd
a barrel, after setting a fresh 3 month high of 28.60 usd a barrel.
"There are reports this morning that the oil unions in Nigeria are to join
in the nationwide strike and that has caused prices to jump this morning," said
analyst David Thomas at Commerzbank.
"People are not going to want to be short over the weekend in this kind of
environment, so we're seeing prices rally as people cover their short
positions," he said.
He quoted reports saying the Nigerian oil union NUPENG is set to withdraw
junior oil workers from their positions from today if the crisis is not
resolved.
Nigerian strikers launched a fourth day of protest amid rising tension today
after overnight talks on fuel prices between labour and government broke down
without any sign of agreement.
Union leaders launched a nationwide strike on Monday after President
Olusegun Obasanjo's government stopped subsidising fuel and hiked petrol prices
by 54 pct.
Prices rallied in midafternoon trade yesterday, after weekly petroleum
reports revealed an unexpected drop in US crude inventories.
However, the gains proved short-lived as a sharp fall in US natural gas
prices yesterday dragged the whole energy complex lower in late trade, analysts
said.
frank.watson@afxnews.com
fw/ra
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