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Tuesday 07th of October 2008
June 27, 2006

Crude oil prices rise on new Iran concerns


by Elaine Frei

The price of crude oil rose again on Tuesday after Iran’s Ayatollah Ali Khamenei reiterated his nation’s position that it has a right to develop and use nuclear technology and said that there was no point in negotiating with the United States concerning the issue. Also sending prices higher were continuing supply concerns after the shipping channel between Lake Charles, Louisiana and the Gulf of Mexico was shut down due to an oil spill. The closure, which is expected to last for several days, has cut deliveries from three refineries and a liquefied natural gas terminal.

August contract Brent crude was up 63 cents to $71.27 per barrel on the International Petroleum Exchange in London, while West Texas Intermediate crude for August delivery was 50 cents higher to $72.30 per barrel on the New York Mercantile Exchange. Meanwhile, Nymex August unleaded gasoline added 1.4 cents to 2.1925 per gallon.

A report of two earthquakes of moderate intensity in Chile, as well as a decline of 2,000 tonnes in London Metal Exchange stockpiles, initially sent copper prices up during the day. However, after peaking at $7,105 per tonne, prices ended up 1.7 percent lower at $6,880 per tonne. A report from the International Copper Study Group said that the first quarter of 2006 saw a surplus of 64,000 tonnes in the copper market, compared with a deficit of 89,000 tonnes during the same period last year. The report added, however, that there was no evidence of the reported surplus in warehouses and that consumption data is often revised upward.

Nickel inventories also fell during the day, by 696 tonnes, sending the price of nickel up 1.4 percent to $20,250 per tonne. The prices of zinc and aluminium were down by 0.5 percent to $2,975 per tonne and by 1.7 percent to $2,505 per tonne respectively.

Precious metals prices were up during the day. Gold added 1.8 percent to $595.60 per troy ounce, while silver was up 3.3 percent to $10.60 per troy ounce. The price of platinum rose slightly to $1,190 per troy ounce and palladium was trading at $313 per troy ounce.

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