Brent crude, used as an international benchmark, rose to $114.20 a barrel before settling to $113.35 in early Friday morning trading. West Texas Intermediate, a gauge of oil prices in the U.S., was up 0.5 percent to $107.11 per barrel. Analysts do not expect any price surges, but say uncertainty in a major oil producer will keep prices high.
After the $2 jump in the West Texas Intermediate Thursday gas prices are expected to increase around 5 to 10 cents in the coming days according to Tom Kloza, senior energy analyst at gasbuddy.com. Gas prices have been stubbornly high, hovering around the $3.64 a gallon, and could remain there as the uncertainty in Iraq continues.
Iraqi oil production had already been cut in February by 10 percent, or 300,000 barrels per day. With continued outside investment in Iraqi oil fields, the market was expecting the country to increase its oil production, which currently stands at 3.3 million barrels a day.
Analysts are worried because Iraq has been the largest source of growth in OPEC oil production in the last few years and any disruption to production is bound to have an impact on the international market.
Rising oil prices will affect other industries, including air carriers and other fuel-depedent transportation sectors.