What's Moving the Oil Markets?

What's Moving the Oil Markets?

•In the early hours of Thursday, Israel launched air strikes on its neighbour Lebanon in retaliation for two soldiers being snatched by Hezbollah guerrillas Wednesday. The fresh attacks are likely to heighten tensions in the middle east region, a key supplier of oil to the west. Israeli Prime Minister Ehud Olmert branded it as an "act of war."

•Intermonth spreads were also significantly higher with the Aug/Sep spread trading around -52 cents in contango, up over 30 cents from the July 6 level. The tightening of the spreads can also be attributed to the tighter North Sea loading programmes for August, brokers noted.

•Crude oil futures were boosted further by news of a ruptured oil pipeline in Nigeria. The pipeline, owned by Italian Eni's Nigerian subsidiary Agip was ruptured with suspicions pointing to sabotage. The pipeline delivers Brass River for export, but the impact on exports was not yet known.

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