Oil Rises to Record Above $118

Crude oil rose to a record above $118 a barrel on concern that a labor dispute in the U.K. and disruptions in Nigeria may crimp oil supply.
TradingEconomics.com, Bloomberg 4/22/2008 8:02:36 AM

Oil rose to $118.05 a barrel in New York as unions planned to strike at a Scottish refinery in Grangemouth that receives shipments of a benchmark crude oil from the North Sea. Royal Dutch Shell Plc said yesterday 169,000 barrels of daily production were suspended because of attacks last week in Africa's largest producer.

Crude oil for May delivery rose as much as 57 cents, or 0.5 percent, to $118.05 in electronic trading on the New York Mercantile Exchange. The contract traded at $117.53 at 1:23 p.m. London time.

Nigeria, the fifth-largest exporter to the U.S. last year, produces low-sulfur crude prized by refiners because of the proportion of high-value gasoline it yields. The country pumped 1.96 million barrels a day of crude in March, according to a Bloomberg survey, down from 2.4 million barrels a day at the end of 2005 as militant attacks have increased.

U.S. consumption of motor fuels peaks in the summer months as people drive to holiday destinations.

The country's Energy Department will probably say tomorrow that gasoline inventories dropped 2.5 million barrels last week from 215.8 million barrels the week before, according to a Bloomberg survey. All of the analysts forecast a decline.

Oil supplies advanced 1.6 million barrels in the week ended April 18 from 313.7 million barrels, according to the median of responses from seven analysts.