Oil Stays Above $104 on Crises in Ukraine, Libya

The price of oil remained above $104 a barrel Tuesday, as investors weighed how the conflicts in Ukraine and Libya were likely to affect crude supplies.

Benchmark crude for July delivery fell 24 cents to $104.11 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils, dropped 30 cents to $110.02 on the ICE Futures exchange in London.

Ukraine is a key conduit for Russian gas deliveries to Europe. A proposed solution to a dispute over Ukrainian natural-gas debts to Moscow raised hopes that a supply cutoff would be averted. Russia’s acceptance of Petro Poroshenko’s victory in Sunday’s presidential elections was also regarded as a sign of easing tensions.

But the resurgence of fighting, as the government in Kiev responded with an airstrike to the pro-Russia separatists’ occupation of the airport in Donetsk, a city of about 1 million in eastern Ukraine, underscored the uncertainties that remain.

Meanwhile, in Libya, which has been unable to stabilize since the ouster of Moammar Gadhafi in 2011, the National Oil Corporation said crude exports stood at 160,000 barrels a day, down from 1.4 million barrels a day a year ago. Several key export facilities are controlled by militias who do not recognize the central government.

In the U.S., the average price for a gallon of gasoline slipped to $3.65. That’s a penny higher than a week ago, and two cents more expensive than at this time last year.

In other energy futures trading in New York:

• Wholesale gasoline fell 3 cents to $3.00 a gallon.
• Natural gas rose 10 cents to $4.51 per 1,000 cubic feet.
• Heating oil slipped 2 cents to $2.94 a gallon.

This article appeared in print in the May 28th, 2014 edition of Hamodia.