Tulsa World: Oil: Prices spike after Iran seizes yacht

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Oil: Prices spike after Iran seizes yacht

By MARK WILLIAMS AP Energy Writer
Published: 11/30/2009 11:01 AM
Last Modified: 11/30/2009 3:15 PM

Oil prices jumped Monday after Britian said a racing yacht carrying five U.K. nationals were removed from a yacht in the Persion Gulf and were being held.

Crude quickly climbed $1.23 and settled at $77.28 a barrel on the New York Mercantile Exchange.

British officials said Monday that the yacht may have strayed inadvertently into Iranian waters when it was stopped last Wednesday.

Prices rose on the specter of some kind of confrontation between the British and the Iranians, one of the world's biggest producers of oil.

Two years ago 15 British military personnel were seized in the Gulf by Iran. Iran charged them with trespassing in its waters, but all were eventually freed.

The jump in prices comes as the gap between what drivers are paying for gasoline compared with a year ago is widening and figures to get worse between now and the end of the year.

Prices at the pump were $2.629 a gallon on Monday, 80.4 cents more a gallon than a year ago, according to auto club AAA, Wright Express and Oil Price Information Services. That is about $40 more a month for a typical motorist.

The Energy Information Administration said Monday in its weekly update that the national average price for a gallon of regular unleaded gasoline fell a penny from last week to $2.629 a gallon. That is the same price that was reported two weeks ago.

The government releases its survey on retail prices late Monday.

Gasoline prices bottomed near $1.61 during the last few days of 2008 as the recession took hold, demand for fuel crumbled and the stock markets tumbled.

Consumers now are paying about $1 billion a day for gasoline, about $300 million more a day for gasoline than they did a year ago.

And in December, for the first time in about 10 years, oil prices are expected to be twice what they were a year ago, says Tom Kloza, chief oil analyst for OPIS.

Crude prices have been trading between $75 and $82 a barrel for the past month or so. Prices hit $33.87 a barrel on Dec. 19.

The rapid rise in prices is worse for consumers this time, however. Before prices doubled in early 2000, a barrel of crude cost about $10.

Prices tumbled $1.61 on Friday and were down as much $5.57, or 7 percent, after Dubai's investment arm, Dubai World, asked for a six-month reprieve on payments for about $60 billion in debt. The drop was the biggest decline in oil prices since April 20.

Energy prices regained some of that ground and by Sunday, the United Arab Emirates took steps to avert any run on banks by panicked depositors.

By Monday, it appeared oil was trading once again on the same factors that have heavily influenced prices for several months — the value of the dollar and global stock markets.

Oil prices usually climb when the dollar falls, as dollar-denominated commodities such as oil and gold become cheaper to investors holding other currencies.

Crude prices rose and fell, following the dollar's strength against the euro.

In other Nymex trading, heating oil for December delivery added 5.6 cents to settle at $2.0181 a gallon. Gasoline added 7.46 cents to settle just above $2 a gallon. Natural gas shed nearly 7 percent, or 34.4 cents to settle at $4.848 per 1,000 cubic feet

In London, Brent crude for January delivery rose $1.29 to settle at $78.47 on the ICE Futures exchange.

___

Associated Press writers Pablo Gorondi in Budapest and Eileen Ng in Kuala Lumpur, Malaysia, contributed to this report.

By MARK WILLIAMS AP Energy Writer

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	Report Comment imahick, tulsa (11/30/2009 3:22:40 PM) that's easy, it IS bush and cheney's fault!!! :) we'll see how they bash good ol george bush here before too long when everyone of obama's plans tank worse than they are now... oh, wait, that's bush's fault too, right?!?!?
	Report Comment justiceawaits, Claremore (11/30/2009 4:21:35 PM) Guess it take time for the oil companies to find the right pockets to fill after an election. They should have enough congressmen and senators in their pockets by next summer to REALY stick it to us.
	Report Comment crsmith989, (11/30/2009 8:45:23 PM) The entire story is garbage. Everybody knows it is but there is nothing the common public can do about it. What happens in the middle of the ocean should have nothing to do with the price of gasoline. There is something bad wrong with this country if the public believes this story.
	Report Comment 007, Tulsa (12/1/2009 11:17:53 AM) Time to let Israel unload on Iran.

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