Oil prices up as Turkey-Syria tension rises

Friday, October 5, 2012, Vol. 36, No. 40
The Associated Press

Oil prices rose Thursday as tension between Turkey and Syria raised concerns that crude oil supplies from the Middle East could be disrupted.

In midday trading on the New York Mercantile Exchange, benchmark crude was up 53 cents to $91.77 per barrel. It nearly reached $93 in the morning.

On Thursday, Turkey claimed that it forced a Syrian passenger plane to land because it was carrying banned cargo from Russia. Syria said there was nothing illegal on the plane, and called the incident piracy.

The two countries have traded artillery fire over Syria's northern border throughout the past week.

Oil prices briefly moved above $100 per barrel in mid-September, then retreated below $90 before their recent increase.

Also Thursday, a report from the Energy Information Administration said crude inventories increased 1.7 million barrels during the past week. That was slightly more than the rise of 1.5 million barrels expected by analysts who were surveyed by Platts, the energy information arm of McGraw-Hill Cos.

The government said gasoline inventories fell a half-million barrels and are near the low end of the average range. Analysts surveyed by Platts had expected gasoline stocks to be unchanged.

AAA said gasoline prices at the pump were unchanged from Wednesday at $3.813 for a gallon of regular.

Brent crude, which is used to price international varieties of oil, rose $1.01 to $114.19 on the ICE Futures Exchange in London.

In other energy trading on the New York Mercantile Exchange:

— Heating oil rose 3 cents to $3.24 per gallon

— Wholesale gasoline was down a penny at $2.95 per gallon.

— Natural gas added 11 cents to $3.59 per 1,000 cubic feet after the Energy Information Administration said natural gas supplies grew by 72 billion cubic square feet during the week that ended Oct. 5. Analysts had expected 76 billion to 80 billion cubic feet, according to Platts.