Reply #35: Oil hits $97 on bombs, demand prediction [View All]

Source: Associated Press

Oil hits $97 on bombs, demand prediction

By JOHN WILEN, AP Business Writer
30 minutes ago

NEW YORK - Oil futures jumped to a new record of $97
a barrel Tuesday after bombings in Afghanistan and an
attack on a Yemeni oil pipeline compounded the supply
concerns that have driven crude prices higher in recent
weeks.

Those concerns were further fed by a government
prediction on Tuesday that domestic oil inventories will
fall further this year while consumption rises.

Oil was already up before news of the blasts in northern
Afghanistan that killed 64 people and the attack in Yemen.
Severe weather forecasts for the North Sea, expectations
that domestic crude supplies fell last week and the weak
dollar all contributed to the latest move upward.

While Afghanistan doesn't produce much oil, traders watch
for the possibility that any escalation in the conflict
there between U.S. armed forces and Islamic militants
could spill over into other countries, disrupting oil
supplies out of the Middle East.

-snip-

Read more: http://news.yahoo.com/s/ap/20071106/ap_on_bi_ge/oil_prices