Oil prices extended gains after Egypt’s political crisis took a turn for the worse with violent clashes erupting between the protesters and supporters of President Hosni Mubarak.
Meanwhile, the riots that have rocked Tunisia and Egypt are rapidly spreading across the oil rich region, having hit Jordan and Yemen and currently threaten the ruling regimes in Syria and Algeria.
In addition to that, there is a growing concern in the markets that the uprising may disrupt oil shipments through Egypt’s Suez Canal, causing a supply shortfall.
Oil futures got another boost from today’s US employment data from the Labor Department, which revealed that initial jobless claims dropped 42,000 to 415,000 last week.
US light, sweet crude for March delivery, which is currently the most active contract on the New York Mercantile Exchange (NYMEX), reached US$91.22/barrel, while April crude advanced to US$94.07/barrel.
March Brent Crude last traded at US$102.61/barrel on the ICE Exchange.
Supermajors BP (LON:BP) and Shell (LON:RDSB) dropped 1.4% and 3.1% respectively.
BG Group (LON:BG) followed with a 1.1% loss.
Tullow Oil (LON:TLW) was flat and Cairn Energy (LON:CNE) posted a small gain.
Engineering firms Amec (LON:AMEC) and Petrofac (LON:PFC) held steady.
Heritage Oil (LON:HOIL) and Melrose Resources (LON:MRS) rose 2.3% and 1.4% respectively, while other midcaps were in decline.
JKX Oil & Gas (LON:JKX) and Salamander Energy (LON:SMDR) shed just over 1%.
Soco International (LON:SIA) declined marginally and Premier Oil (LON:PMO) held steady.
Service company Wood Group (LON:WG) advanced 2.8%.