Restricted supplies helped drive up the price of crude oil futures on Tuesday, according to published reports.
The energy commodity pushed higher than $91 per barrel as a strike among Norwegian oil workers posed a serious threat of cutting down on supplies from the North Sea, Reuters reports. The warring sides are unlikely to resolve the conflict any time soon.
In advance of crude oil inventories in the U.S. being forecast to decrease by as much as 700,000 barrels last week, the energy commodity was feeling the pinch of the ongoing economic tumult in the euro zone.
A two-day summit scheduled for later this week among euro zone leaders in Brussels is unlikely to solve the sovereign debt crisis, which is likely to cap the energy commodity's gains.
"Brent crude is up due to the ongoing strike by Norwegian oil workers that has shut some production," analyst Gene McGillian with Tradition Energy in Connecticut told Reuters.
At 12:19 p.m. on Tuesday, crude oil futures increased 0.89 percent, an 81 cent lift to $91.82 per barrel.
An upgrade in tension between Syria and Turkey also proved to be beneficial to crude oil futures. Member states of NATO condemned Syria for downing a military jet from Turkey as the anti-government campaign continues in Syria.
Officials in Ankara, the capital of Turkey issued the warning to their counterparts in Damascus, the capital of Syria.
Bloomberg reports pessimism for the Brussels summit tempered the gains. Scheduled for Thursday and Friday, the summit represents the region's 20th meeting to control damages caused by the sovereign debt crisis, which has been thrashing about the euro zone since early 2010.
Greece, the emblem of the damages caused by the scourge, thus far has accepted two bailout packages since June 2010. Ireland and Portugal soon followed in the request for bailout aid and Spain requested aid for its debt-hobbled banks. Cyprus this week also requested bailout aid as a consequence of damages caused by the sovereign debt crisis.
An additional factor pressuring the price of crude oil futures on Tuesday is Tropical Storm Debby as the tempest slowly moves about the Gulf of Mexico. Thus far Debby has not presented a threat to oil facilities along the Gulf Coast but equities drew down and the value of the U.S. dollar was pushing up.
But many traders and investors were keeping a close eye on developments with the Norwegian oil workers, according to The Wall Street Journal.
The market for sweet crude in Europe is likely to tighten as a result of the labor dispute, according to analysts from JP Morgan.
"The labor dispute "has the potential to tighten the European light sweet crude market, particularly as refinery runs increase following the spring maintenance period," according to the analysts, as cited by The Wall Street Journal.
One factor that drove the price of crude oil higher on Tuesday was South Korea noting it plans to stop importing crude oil from Iran, effective July 1. The indefinite ban follows suit with sanctions levied against the oil-rich Middle Eastern nation, whose nuclear program ambitions have drawn the diplomatic actions from Western nations.
Summit Energy analyst Matt Smith told The Wall Street Journal that 250,000 barrels per day that South Korea otherwise would have imported from Iran will need to be supplied elsewhere. Consequently, the indefinite halt was impacting the price of the energy commodity.
As part of the effort to cover the reductions to volumes caused by the sanctions, Gulf nations like Saudi Arabia have increased their production of the energy commodity.
Nonetheless, investors and traders remain on edge as the sanction date nears.
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