Iran General NewsOil breaches $60 on concern over supply, Iran

Oil breaches $60 on concern over supply, Iran

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Reuters: Oil on Friday broke through the psychological $60 a barrel level for the first time in more than a month, spurred higher by tighter supplies and worries about rising tension between the United States and Iran. By Barbara Lewis

LONDON (Reuters) – Oil on Friday broke through the psychological $60 a barrel level for the first time in more than a month, spurred higher by tighter supplies and worries about rising tension between the United States and Iran.

U.S. crude oil was 31 cents higher at $60.02 a barrel by 1511 GMT. It earlier hit a session peak of $60.42, the highest level since January 3.

London Brent crude was 22 cents stronger at $59.25.

Iran’s Supreme Leader Ayatollah Ali Khamenei said on Thursday the Islamic Republic would target U.S. interests worldwide if it came under attack over its nuclear program.

Traders were also nervous ahead of the anniversary of the 1979 Islamic Revolution on Sunday, when the war of words between OPEC oil producer Iran and the United States over Tehran’s nuclear program could intensify, analysts said.

But they had yet to be convinced Friday’s price gains would be maintained.

“To stay above $60 on a sustainable basis would take some confirmation the Iranian situation is deteriorating further,” said Olivier Jakob of Petromatrix.

Reduced supplies from the Organization of the Petroleum Exporting Countries have helped to boost prices, which in January fell to a 20-month low of $49.90 for U.S. crude.

OPEC’s overall exports in January fell by 200,000 barrels per day (bpd) from December, shipping data from Lloyd’s Marine Intelligence Unit showed, bringing the group closer to its pledged supply cut of 1.2 million bpd from November.

The group’s exports were expected to fall again in February with the implementation of a second OPEC cut of 500,000 bpd.

In addition to voluntary decreases in production, analysts were also predicting that militant attacks, which have already disrupted Nigeria’s output, would get worse in the run-up to presidential elections in April.

(Additional reporting by Osamu Tsukimori, Angela Moon and Janet McBride)

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