Oil price higher after Mideast bombing

 

The price of oil edged higher in London today after a suicide bombing in Israel cast a shadow over Middle East peace efforts, with additional support provided by data showing a recent fall in levels of US oil stocks.

Brent North Sea crude oil for June delivery rose to 25.51 dollars a barrel by early afternoon, an increase of 10 cents from the closing price on Tuesday.

Oil prices have fallen in recent days on anticipation of the resumption of exports by Iraq, which will increase supply even as prices are weakening.

But prices regained some ground on concerns that the latest suicide bombing in Israel might derail the tentative peace process.

Prices were also supported by unofficial estimates from the American Petroleum Institute (API) showing that US crude inventorll by 4.5 million barrels last week, though the drop was offset somewhat by a rise of 3.9 million barrels in gasoline inventories.

Analysts said that the crude stock fall, which was twice as big as most market watchers had been expecting, was probably the result of the recent Iraqi export halt, though they noted it followed a jump in stock levels the previous week.

Iraq said on Wednesday it would resume oil shipments on Thursday after deciding against extending a month-long stoppage in support of the Palestinians.