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Oil rises to close to USD62

Written by Business World, on 16th Feb 2015. Posted in Technology

article headlineOil rose to near $62 a barrel today, supported by concerns over escalating conflict with Islamic State militants in Libya and predictions of lower supply in the second half of the year. Egypt bombed Islamic State targets inside Libya on Monday and Cairo renewed calls for a U.S.-led coalition to confront militants there, a day after the group released a video appearing to show the beheading of 21 Egyptians. "The geopolitical risk is not something to write off," said Olivier Jakob, oil analyst at Petromatrix in Zug, Switzerland. Libya's oil production has mostly shut down, falling to 350,000 barrels per day (bpd), from 1.6 million bpd before the 2011 ousting of leader Muammar Gaddafi. Crude flows from the El Sarir oilfield remained disrupted after a pipeline was attacked and set on fire. Further supporting the market, Kuwait's oil minister said oil prices would continue to rise this year as supply fell. "Hopefully in the second half of 2015 we will see better prices," said the minister, Ali al-Omair. Benchmark Brent futures traded at $61.75 a barrel, up 23 cents, at 1440 GMT. U.S. crude was up 5 cents at $52.83 a barrel. Trading volumes were reduced as U.S. markets remained closed for a public holiday. Oil markets rose strongly last week after another drop in the U.S. rig count, pushing Brent back above $60 a barrel for the first time since December. The price of Brent has increased by more than 30 percent since January, supported by signs of lower oil industry spending. In January it hit $45.19, the lowest in almost six years, down from $115 last June. Kuwait's Omair said the current oil surplus was now "definitely lower" than 1.8 million barrels per day. For more visit www.businessworld.ie

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