Oil prices rise on Egypt worries

SINGAPORE - Agence France-Presse

the Suez canal carries about 2.5 million barrels daily, about 2.7 percent of global supply. AP photo

Oil prices rose in Asia on Friday, supported by concerns about turmoil in Egypt after a crackdown on protesters killed nearly 600 people nationwide, analysts said. Investors are closely watching whether the latest unrest in Egypt will escalate and affect stability in the oil-rich and politically volatile Middle East region. New York's main contract, West Texas Intermediate for delivery in September, was up 16 cents at $107.49 a barrel in afternoon trade.
 
Brent North Sea crude for October delivery was up 20 cents at $109.80. "Oil prices advanced ... on worries that escalating violence in Egypt could impact the oil shipment along Suez Canal or spread across the Middle East, where supplies already face disruptions," said Lee Chen Hoay, investment analyst at Phillip Futures in Singapore. Michael McCarthy, chief market strategist at CMC Markets in Sydney, said oil prices already include a "risk premium" as investors grow accustomed to constant threats of a disruption in Middle East supply. "Egypt is clearly having an impact on prices, but the reality is constant talk of a Middle East supply disruption has almost become background noise for investors," he said. Islamists in Egypt have called for a "Friday of anger" in Cairo after the nationwide death toll following a crackdown against supporters of ousted President Mohamed Morsi on Wednesday rose to 578, making it the country's bloodiest day in decades.
 
The call raised fears of fresh violence amid renewed attacks on security forces on Thursday. Traders are worried that the unrest could hit crude shipments through the Suez Canal and Sumed Pipeline, which provide a link between Europe and oil producers in the Gulf.
 
Although Egypt is not a major oil producer, the Suez canal carries about 2.5 million barrels daily, about 2.7 percent of global supply.