Oil rose to the highest level in three days on speculation that China will intensify monetary stimulus, supporting fuel demand, and as France pushed for a ban on Iranian imports.
France wants a European Union embargo delayed by no more than three months as members seek alternative supplies, an official with knowledge of the matter said yesterday. China’s economy expanded at the slowest pace in 10 quarters, sustaining pressure on Premier Wen Jiabao to ease monetary policy. Saudi Arabia aims to stabilize the average of crude prices worldwide at that level in 2012, Ali al-Naimi said in an interview with CNN yesterday.
“Everything is rising because of China,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “It’s general market sentiment.”
Crude for February delivery rose as high as $100.71 a barrel in electronic trading on the New York Mercantile Exchange, up $2.01 from the Jan. 13 closing price, and traded at $100.46 at 9:05 a.m. London time. Floor trading was shut yesterday for the Martin Luther King Jr. holiday and electronic transactions will be booked with today’s for settlement purposes.
Brent oil for March on the London-based ICE Futures Europe exchange gained as much 1.2 percent to $112.58 a barrel. The European benchmark contract was at an $11.38 premium to New York-traded West Texas Intermediate grade for the same month. The front-month spread was a record $27.88 on Oct. 14.
European Embargo
France is seeking a shorter exemption for crude contracts with Iran even as other EU members favor a six-month delay, according to a second official, who also asked not to be identified because the talks are confidential.
EU foreign ministers are scheduled to decide at a Jan. 23 meeting on the ban, which will probably include an exemption for Eni SpA, Italy’s largest oil company. An embargo requires unanimous approval by the bloc’s 27 states.
Iran, OPEC’s second-largest producer, has threatened to block oil shipments through the Strait of Hormuz in retaliation against international sanctions.
