Oil Prices Extend Gains

Tuesday, February 2, 2010 at 7:40 pm

LONDON : Oil prices rose on Tuesday, building on strong gains won a day earlier in the wake of robust US manufacturing activity and fresh unrest in Nigeria’s key oil-producing region. Oil Prices Extend Gains

New York’s main futures contract, light sweet crude for delivery in March, was up 27 cents at 74.70 dollars a barrel at about 0945 GMT.

Brent North Sea crude for delivery in March gained 29 cents to 73.40 dollars.

“In the near term, pricing will likely stay around the mid-70s level,” forecast said Victor Shum, an analyst at Purvin and Gertz energy consultants.

“When we see more signs of economic recovery, prices will creep back to 80 dollars but that might be in a few weeks,” Shum added.

Crude futures had closed up more than 1.5 dollars on Monday after a report from the Institute of Supply Management showed a brisk pace of manufacturing activity in the United States — the world’s biggest energy consumer.

The ISM said its manufacturing index, also known as the purchasing managers index, climbed to 58.4 percent in January, the best number since 2004 and well ahead of the 50 percent that indicates growth.

Renewed violence in Nigeria also fuelled prices.

Anglo-Dutch oil group Shell on Monday said it was forced to cut output after a key supply pipeline was sabotaged hours after militants announced the end of a ceasefire in southern Nigeria.

Oil Prices Extend Gains

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