Brent hits two week high near $112, as South Sudan supply remains in focusMonday 23 December 2013 07.50
Brent crude hit a two-week high near $112 a barrel today as internal strife in South Sudan threatened the country's oil output, adding to supply woes in Africa.
South Sudan's government said over the weekend that rebels had seized the capital of a key oil-producing region.
Fears grew of an all-out ethnic civil war in the world's newest country that could cut off its 245,000 barrels a day (bpd) oil output.
This could add to the more than 1 million bpd of lost supply from Libya where key oil ports were shut by a group demanding greater autonomy for the country's eastern part.
February Brent crude edged down four cents to $111.73 a barrel in early trade after gaining 2.7% last week. It touched a high of $111.93 earlier in the session.
US crude for February delivery was at $99.01 a barrel, down 31 cents.
South Sudan's ambassador in Khartoum said on Sunday that oil was flowing normally although the country's main investor China National Petroleum Company has evacuated its oil workers from the fields to the capital Juba.
Libya's oil minister said on Saturday force should be used to reopen key oil ports in the eastern part of the country which have been closed for five months.
Analysts said that any resumption of oil exports is likely to occur in a staggered manner with high chances of a relapse through 2014 as other political elements within the country emerge as risk factors.
Worries about short supplies have caused the oil market's pricing dynamics to shift, with prompt delivery oil rising above prices for future delivery, Saudi Arabia's oil minister said on Saturday. The minister played down suggestions that the kingdom was ready to cut production.
Oil also remained supported by expectations of robust fuel demand at the world's largest oil consumer after the US economy grew at its fastest pace in almost two years in the third quarter. US petrol prices hit a three-month high on Friday, buoyed by refinery strikes in France and refinery glitches in the US.
Workers voted to end a strike over pay at Total's Donges refinery in western France on Sunday, the oil company said, though industrial action continued at three other plants.