The price of oil climbed above $107 a barrel today as the escalating violence in Egypt was seen as threatening stability in the Middle East, and US crude supplies fell in a possible sign of stronger demand.
Benchmark crude for September delivery was up 48 cents to $107.33 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents to close at $106.85 yesterday.
Brent crude, traded on the ICE Futures exchange in London, was up 81 cents to $109.63 a barrel.
The Egyptian Health Ministry said that over 500 people had died so far and over 3,700 were injured in clashes between police and supporters of ousted Islamist President Mohammed Morsi.
The government declared a nationwide state of emergency and a night-time curfew. Nobel Peace Prize winner Mohamed ElBaradei resigned as Egypt's interim vice president in protest at the violence.
Egypt controls the Suez Canal and the nearby Sumed pipeline. While these crucial transport routes for Middle East oil are not expected to be hampered, analysts said that the risk premium is likely to rise following the latest events.
Analysts also noted the large drop in Libya's oil output, which, at around 650,000 barrels a day, was about 1 million barrels a day lower than a year ago due to field closures and export disruptions.
In the US, meanwhile, the latest supply reports showed a drop in crude inventories, with the US Energy Department saying supplies fell by 2.8 million barrels, about double what analysts expected.
