From Reuters;
* Russia strengthens control over Crimea, calls U.N. meeting
* Risk to oil flows seen low but Russia key supplier
* Russian natural gas supply in doubt, European storage high
* U.S. manufacturing growth rebounds from 8-month low
(Updates news on Crimea, adds new prices, analyst commentary,
changes byline, dateline, previous LONDON)
By Elizabeth Dilts
NEW YORK, March 3 (Reuters) - Crude oil prices rose by more
than $2 a barrel on Monday as tensions mounted amid Russian
military intervention on the Crimean peninsula.
The U.N. Security Council announced it will hold its third
emergency meeting on the Ukraine crisis on Monday, this time at
Russia's request, as Moscow tightens its hold on Crimea,
diplomats said.
Russia is one of the world's biggest oil producers, and
while analysts said it was unlikely Russian oil supplies would
be disrupted by the Ukraine crisis, global oil prices rose as
investors pulled out of riskier assets like stocks.
Brent crude spiked to an intra-session peak of
$112.39 per barrel, its highest since Dec. 30, and was up $2.30
at $111.37 by 12:14 p.m. EST (1714 GMT).
U.S. crude jumped as much as $2.63 to a high of
$105.22 a barrel, before easing to $104.65.
"There is a risk premium in the oil markets in anticipation
of this situation turning into something worse than it is," said
Dominick Chirichella, senior partner at Energy Management
Institute in New York.
- I don't think the West can afford an economic embargo on Russian oil, it would be too damaging to our economies, but if it gets into a tit for tat economic war, Russia could restrict supplies to us and cause uncertainty in the markets.
One of the troubles with conflicts is they can rapidly get out of hand and the possible knock on effects are unpredictable. Middle East tensions always up the oil price, and so will Russian tensions. Just look at the current oil price moves today to see that.
