Wednesday, July 3, 2013

Oil rises due to Egypt problems

WTI oil price exceeded U.S. $ 100 for the first time since September on Wednesday, while the Brent – is close to 105 USD per barrel price level due to sharpening political turmoil important in Egypt. These kind of political unrests have strong influence on the oil market.

"Black Gold" price rise got into full swing when Egyptian President Mohamed Mursi dismissed the army an ultimatum to resolve the political crisis in the country. The army has warned that it will take action if the government and its opponents ignore the "will of the people."

Due to the political crisis in Egypt at least five ministers have already resigned from their positions. The country has been more than one day in ongoing protests against Mr. Mursi, who accused the Muslim Brotherhood of elevating their interest above the interest of the state.

Egypt is not particularly significant oil exporter, but due to its location is one of the most important oil transit countries in the world.

In particular, oil prices increased as the news of U.S. oil inventories fall last week most this year.

"Today's oil prices are influenced by two factors - knowledge of depleting oil reserves in the U.S. and unrest in Egypt. If excitement gets momentum it poses a threat to oil transit the Suez Canal and the Suez-Mediterranean pipeline, "- said the news agency Bloomberg Says Mark Keenanas, Societe Generale commodity strategist.