Oil nears $120 following labor and military strikes

[HARDCORE]

[media]http://biz.yahoo.com/ap/080428/oil_prices.html[/media]

AP
Oil nears $120 following labor and military strikes
Monday April 28, 9:29 am ET
By George Jahn, Associated Press Writer
Oil prices hit new trading record near $120 with UK pipeline shut down
and Nigerian unrest

VIENNA, Austria (AP) -- Oil prices hit an all-time high near $120 a barrel Monday after a weekend refinery strike closed a pipeline system that delivers a third of Britain's North Sea oil to refineries in the U.K.
The shutdown comes amid supply outages in Nigeria that have helped to support oil against a strengthening dollar.

"We've got a confluence of a number of events that have really disrupted crude oil supply," said Victor Shum, an energy analyst with Purvin & Gertz in Singapore. "That's what's driving oil to a new record even though the U.S. dollar actually strengthened a bit."

Light, sweet crude for June delivery rose to a record $119.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract eased back to $119.04 a barrel by afternoon in Europe, up 52 cents from Friday's close of $118.52.

BP PLC on Sunday shut down the Forties Pipeline System that carries more than 700,000 barrels of oil a day to the U.K. because of a 48-hour walkout by employees at a refinery in central Scotland.

Workers walked out of the Grangemouth refinery in a dispute with refinery owner Ineos over plans to close a pension plan to new employees. Ineos Chief Executive Tom Crotty said it could take a week for the plant to return to production once the strike ends on Tuesday. BP said its pipeline could be up and running within 24 hours.

BP's Kinneil plant, the onshore processing center for the pipeline system, is powered by the Grangemouth site.

"With the refinery being shut down, it will affect supplies from the North Sea and that has a potentially significant impact," said David Moore, a commodity strategist with the Commonwealth Bank of Australia in Sydney. "That comes at the same time that there's production disruptions from Nigeria, so the combined effect of those is the immediate factor that's put pressure on oil prices."

Analyst Stephen Schork also attributed the bullish market to the combination of events stoking supply concerns.

"News that BP shut-in 40 percent of the Forties Pipe compounded the latest headline out of Nigeria regarding a rebel attack near that country's largest oil and gas export terminal on Bonny Island," he said in his Schork Report. "Thus, all of that 'bubble talk' aside, the market looks stronger than ever."

In Nigeria, the Movement for the Emancipation of the Niger Delta, or MEND, said its fighters hit an oil pipeline late Thursday, the fourth conduit the group has attacked in the past week. MEND said the pipeline belongs to a Royal Dutch Shell PLC joint venture. A Shell spokesman confirmed one of its pipelines had been hit, but provided no additional
details.

Separately, workers at an ExxonMobil Corp. joint venture there cut production by an unspecified amount to demand more pay.

Demand is high for Nigeria's light, sweet crude, which is easily refined. After years of militant attacks, however, Nigeria's output is dropping and the country can produce only about 75 percent of its official production capacity of 2.5 million barrels per day.

This week, the oil market is also expected to closely watch the outcome of the U.S. Federal Reserve's policy meeting on Tuesday and Wednesday.

The central bank's policymakers will meet to decide whether to lower interest rates again and to issue an updated assessment of the U.S. economy and financial system. Most investors believe the Fed will lower rates by another quarter percentage point -- and that it will also suggest it may temporarily halt its round of recent cuts.

"There are a lot of expectations that the Fed will make an announcement that they will take a pause in interest rate cuts," Shum said. "If that's the case, then the U.S. dollar may bottom out and that could cause some pullback in oil pricing."

Many analysts believe the weakness of the dollar is a bigger factor than supply and demand because the soft dollar draws investors worried about inflation into commodities such as oil. It also makes commodities less expensive for buyers operating in other currencies. In other Nymex trading, heating oil futures were flat at $3.310 a gallon while gasoline prices moved up slightly to fetch $3.0568 a gallon. Natural gas futures added over 10 cents to sell at $11.072 per 1,000 cubic feet.

Brent crude futures rose 65 cents to $116.99 a barrel on the ICE Futures exchange in London.

Associated Press writers Gillian Wong in Singapore and Jamey Keaten in Paris contributed to this report.

[reconeil]

Get used to it, Rick (plus all others BIG TIME screwed or screwees).

As long as U.S. Leaders and/or Policy Makers don't see that Country's
National Resource is PRICED FAVORABLY for it citizenry as most OTHER
Oil Exporting Nations do for their people & economies,.......................
just suck it up like the rest of US (both ways) Suckers,...and live with it.

Don't think Mexicans pay 3-4 dollars a gallon? Do they?
Know for certain that the mean old Venezualans (other Oil Exporters also) don't.

Neil

P.S. Thinking about buying a bike (pedal type).

[sn-e3]

I think we should pull our troops from the mid east unless the oil prices drop drastically. see how long the opec nations gouge us without our military help to control their natives. as far as the oil companys they are all corupt just like our politions who allow us to be bled dry.

[1CAVCCO15MED]

Remember when Bush first came into office there was a meeting between VP Cheney and the oil industry representatives? Our oil policy came out of that meeting. Since then they have looted and weakened our nation to the point of treason. They don't care, their country is their corporation. They view the government as their employees and the public as their vassals. They have us as their willing accomplices using talk radio to give us something to look down on and boy, do we. Welfare mothers, liberals, anyone they brand as trying to take away from us while the hand of oil is in our back pockets. Over and over they have convinced us to vote against our own self interest by making us think we are denying the ones they call parasites. Millions will stand up and say any change in the way we pay for health care is socialism but never have I heard one person volunteer to be one of the thousands that have become bankrupt by a system that is first in the world in cost and thirty third in quality. It always happens to "those people", not us good conservatives and we sneer at them even when it turns out to be our own parents or family that go bankrupt. I will be sixty one in abut two weeks and I consider myself lucky to be so old. I believe our children and grandchildren will reap the whirlwind we have created. Our country is already bankrupt and it is just a matter of time until the whole thing topples to the laughter of the world until they discover we took them with us.

[sn-e3]

Doc well said, but the trouble is both partys are corrupt we need another bull moose party like teddy had back at the first of the past century. some people who won't cow tow to the lobbiest. clean out washington DC and start from scratch. Impose a new law that if you are 1 1/2 times wealthyer when you elected term is over you are automatically shot on the spot. Then lets see who wants to run for office. Only the honest man or women who care for their people.

[reconeil]

Don't think too many political lords (and especially now rich: "Slick Willy")
will appreciate your; "Automatically shot on the spot" bit, since being
MUCH WEALTHIER (AS MOST USUALLY ARE) after leaving office.

Neither will THE MANY OTHERS: "Connected" and similarly haven gotten wealthier
from their political affiliations be too thrilled, if loosing their longtime meal tickets.

Why being so mean, Sn-e3?

Neil

[sn-e3]

Neil I'm not being meen just being sure. The way to kill a snake is to cut off its head.

[SuperScout]

Originally Posted by 1CAVCCO15MED

Remember when Bush first came into office there was a meeting between VP Cheney and the oil industry representatives? Our oil policy came out of that meeting.
Have you ever heard of supply and demand? Are you aware of the fact that there has been a 30% increase in demand alone in the last 12 years, with China and India driving most of that demand?
Since then they have looted and weakened our nation to the point of treason.
Pretty strong words. How much control does this president, or any of our presidents have over the price as set by OPEC?
They don't care, their country is their corporation. They view the government as their employees and the public as their vassals. They have us as their willing accomplices using talk radio to give us something to look down on and boy, do we.
Do you really believe this drivel? I don't need 'talk radio' to look down on the morons who think that more government is going to solve any problem.
Welfare mothers, liberals, anyone they brand as trying to take away from us while the hand of oil is in our back pockets. Over and over they have convinced us to vote against our own self interest by making us think we are denying the ones they call parasites. Millions will stand up and say any change in the way we pay for health care is socialism but never have I heard one person volunteer to be one of the thousands that have become bankrupt by a system that is first in the world in cost and thirty third in quality.
And what is the government's role in this 'bankruptcy' you're whining about? Artifical price controls are much of the culprit, and yet the liberals are wanting more governmental control, ultimately resulting in a rationing of health care, as being experienced in both Canada and England.
It always happens to "those people", not us good conservatives and we sneer at them even when it turns out to be our own parents or family that go bankrupt. I will be sixty one in abut two weeks and I consider myself lucky to be so old. I believe our children and grandchildren will reap the whirlwind we have created.
It's true that we have overspent by billions. Both parties are at fault. The sooner our government returns to a buget driven by constitutional mandates only, the sooner we'll return to fiscal sanity.
Our country is already bankrupt and it is just a matter of time until the whole thing topples to the laughter of the world until they discover we took them with us.

A better solution to all this would be implementation of the FairTax Plan.

[Packo]

Gasoline has gone up 1.50 a gallon since the Democrats took power in Congress. They are obviously in cahoots with Bush and Cheney. Now the Democrats have a new plan....raise taxes on the oil companies. That will teach them. Problem is, if I was a small business and guvmint raised taxes on me, I'd probably pass that on to the consumer...us, the little guy. So glad the Democrats are "for the little guy". I would have to say that nobody in Washington really gives a shit about me...and the world market, not Bush, Cheney, or the Democrats, have a friggin' thing to do about the price of oil. Come on Doc....tell me that you really believe the White House controls the price of oil. Ridiculous...and I'm not a supporter of President Bush. Look at what government has done to the price of corn and all the starving people in the world. That's a Democrat thing....and I don't blame them, I blame stupidity. Look at the price of milk! Damn Bush and Cheney for cornering the big dairy market. Lord help me.

Pack

[DeadlyDaring]

Australia is currently paying Aust-$5.75 - $5.95 a US gallon in fuel

1 US gallon = 3.875 litres

Milk is now Aust-$2.64 a litre