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Oil feels pressure from Middle East crises

Aug. 17, 2012 at 7:12 AM   |   Comments

WASHINGTON, Aug. 17 (UPI) -- Potential geopolitical crises in the Middle East are likely to have a ripple effect on the global oil sector, analysts and U.S. government officials said.

Crude oil prices on the New York Mercantile Exchange climbed for most of the week. Eugen Weinberg, a commodities analyst Commerzbank in Frankfort, told Bloomberg News that U.S. crude prices could slip, however, because of "high inventories, high imports (and) anemic demand."

Crude oil prices early this year spiked in part because of Iranian threats to close the Strait of Hormuz. The U.S. military deployed to the region to protect key shipping lanes, sparking protest from Iranian commanders who said littoral states were responsible for regional security.

David Goldwyn, a former U.S. State Department energy official, told The New York Times that a potential disruption in the strait "poses a physical threat to U.S. supply as well as a potential price shock on a global level."

Adam Sieminski, an Energy Department official told the Times that "if oil prices go up because of a problem in the Middle East, that causes a problem for the world in general and not one that is specific to the United States."

Oil prices for September delivery declined 62 cents to $94.28 during the latest trading session on the NYMEX.

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