Oil prices jump on Egypt unrest

Posted By GABRIELLE LEVY, UPI.com   |   July 5, 2013 at 4:32 PM   |   Comments

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July 5 (UPI) -- Oil prices hit their highest level since May 2012, jumping nearly 2 percent to $103.22 a barrel Friday.

The climbing futures contract for August, which gained $1.98 Friday, is a reaction to the unrest in Egypt, where the armed forces Wednesday deposed President Mohamed Morsi and installed former Chief Justice Adly Mansour in his place.

Prices soared almost 7 percent on the week, the biggest gain since Feb. 25, 2011, two weeks after former President Hosni Mubarak was thrust from office after the protests that carried Morsi into office last year.

While Egypt does not itself produce much oil, the Suez Canal, a major shipping throughway, passes through the country.

And while the canal is still operating normally, fears stemming from the unrest grew Friday after Egypt closed its borders with the Gaza Strip and announced states of emergency in Suez and Sinai provinces.

Still, oil was already up 8 percent in the past month, driven by the strengthening U.S. economy and a slightly rosier jobs picture than expected in June.

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