Oil prices jump amid renewed political tensions

Oil prices surged on Tuesday as traders reacted to yet another outbreak of violence in Libya and the continued unrest in Ukraine.

The price of oil had registered its lowest point in a month on Monday when Libya reopened Zueitina, an oil port city in the east of the country that had been closed for the past nine months due to unrest, raising the prospects of an increase in global oil exports.

However, the following day concerns over Libya were renewed once again after armed gunmen stormed Libya’s parliament and a car bomb exploded in Benghazi.

Meanwhile, the confrontation between Russia and Western powers over Ukraine did not show any signs of abating, also increasing fears that the conflict there would ultimately lead to some disruption of oil supplies due to increasing sanctions against Russia.

So although the international price of Brent crude oil for delivery in June had decreased on Monday by 1.4 per cent, on Tuesday it rose by 0.8 per cent, or 86 cents, to finally settle at $108.98 per barrel after spending most of the day trading at $109.

US light crude oil prices rose by 0.44 per cent, or 44 cents, to settle at $101.28 a barrel, after reaching a high of $102.20 earlier in the day.