UPI Energy Watch

Oil prices jump after weeks of decline

Analysts blame the nearly $6 increase in crude oil prices Thursday on fear that a war may break out between Russia and Western nations after Russia invaded Georgia last week, British newspaper The Guardian reported.

Oil was at its lowest price since May at less than $110 per barrel of Brent crude but jumped to more than $115.

A researcher at the Inter-American Foundation told The Guardian that part of the tension came from the signing of a deal between the United States and Poland regarding missile defense.

He also pointed to the hovering Tropical Storm Fay and concern over oil production in the Gulf of Mexico as another possible reason for the price hike.

In the last year most of the geopolitical tension has been focused on the Middle East in Iran and Iraq, but the focus has shifted in the past two weeks.

One other possible reason for the sudden jump in oil prices was the economic trouble in the United States, the IAF researcher told The Guardian.

The jump in fuel prices for fall and winter delivery had some worried about cold weather and how the poor will afford heat, especially in the United Kingdom where they are competing with Asian countries for liquefied natural gas supplies.

China, Iran to discuss energy cooperation

Frequent new oil and natural gas discoveries are being made in China, the most recent from PetroChina Co. Ltd. in the Junggar Basin, where gas flows of 50,000 cubic feet and 110 cubic meters of oil equivalent were found, China Knowledge reported.

Still, China is hungry for more power. PetroChina alone has a goal of 20 million tons of oil equivalent from Xinjiang province in 2010, with annual gas output of more than 5 billion cubic meters.

Iran and China have plans to strengthen their energy cooperation during an upcoming visit of the National Iranian Oil Co.'s managing director to Beijing, Iran's Oil Ministry told PressTV.

Seifollah Jashnsaz will visit China to discuss energy technology, liquefied natural gas sales and participation in the South Pars gas field.

Iran and China already take part in about $20 billion worth of energy deals a year, the oil ministry said, and that does not include a deal between China National Offshore Oil Corp. and Iran to build a $16 billion gas field and liquefied natural gas terminal.

Vietnam and Uzbekistan will work on oil and gas exploration

The two countries reportedly have agreed to work together on oil and gas exploration in Uzbekistan, according to news agency Nhan Dan.

They also will work on developing technology to created liquefied natural gas from gas from underground coal mines.

Leaders of both countries were in attendance at the meeting of the Vietnam-Uzbekistan Inter-governmental Committee on Economic, Commercial, Scientific and Technological Cooperation in Hanoi.

In return, along with money, Uzbekistan will provide a steady export of cotton and cotton fiber to Vietnam.

The Vietnamese delegation was led by Le Danh Vinh, deputy minister of industry and trade, and the Uzbek delegation was headed by N. Najimov, first deputy minister of the Ministry of Foreign Economic Relations, Investment and Trade.

Trade between Vietnam and Uzbekistan was $6 million in 2007 and will increase with this recent deal.

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Closing oil prices, Aug. 22, 3 p.m., London

Brent crude oil: $115.88

West Texas Intermediate crude oil: $118.92

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(e-mail: energy@upi.com)