World oil prices rose on Monday after union leaders announced plans for an indefinite general strike in Nigeria, Africa’s largest exporter of crude, to begin later this month, traders said.
New York’s main contract, light sweet crude for delivery in December, rose 49 cents to $52,25 a barrel in electronic trading.
In London, the price of Brent North Sea crude oil for delivery in December climbed 43 cents to $49,41 a barrel in electronic deals.
The International Petroleum Exchange in London on Monday began delaying the start of floor trading in Brent crude by four hours until 2pm (2pm GMT) in a move aimed at promoting its internet-based dealing system.
”Prices are higher because of Nigeria and the potential for another general strike to break out in the country,” GNI-Man Financial trader Lee Elliott said.
Analysts said trading was likely to be cautious ahead of Tuesday’s United States Presidential election.
”Traders are likely to remain wary of placing heavy bets either way,” analysts at the Sucden brokerage firm said.
Nigerian unions on Monday began their build-up to a nationwide general strike when senior labour leaders went to court to fight a bid by the oil giant Shell to prevent their members disrupting oil production.
On Sunday, a coalition of unions and civil society groups vowed to stem the flow of oil from Africa’s biggest producer when they launch an indefinite nationwide protest against rising domestic fuel prices on November 16.
The unions brought Nigeria to a halt between October 11 and 14 in what they called a ”warning strike” in protest at the fuel price increase.
The strike paralysed economic life in major cities but did not disrupt oil exports, which account for more than 95% of Nigeria’s foreign revenue.
”All the oil workers will be involved in the [new] strike,” said Nigeria Labour Congress president, Adams Oshiomhole.
”Last time there was no disruption of the upstream oil sector. Now the only way for the government to listen is to interrupt the oil flow.”
With exports of 2,5-million barrels per day, Nigeria is Africa’s biggest oil producer and the sixth largest in the world. Its sweet, light crude is ideal for refining into petrol, and it supplies 15% of the key US market.
Elsewhere, production at Kuwait’s three oil refineries, which came to a halt on Sunday because of a power cut, resumed on Monday at 80% of capacity, the energy minister said.
Power was cut across the Gulf state on Sunday, causing a complete halt to refinery operation, although officials said crude oil output and exports were not affected.
Oil prices have come down from record highs close to $56 a barrel in New York last month — summits reached due to militant violence in Nigeria, strike threats in major producer Norway, unrest in Iraq, hurricanes in the Gulf of Mexico and surging Chinese demand.
World oil prices have surged by about two-thirds since the start of this year, driven by strong demand and global production strains.
Adjusted for inflation, however, prices remain well below the levels reached in the wake of the 1979 Iranian revolution when prices surged beyond the equivalent of $80 a barrel in today’s money. – Sapa-AFP