things just keep getting better
Oil passes $61 a barrel on Saudi king's death
By Gillian Wong, Associated Press
SINGAPORE — Crude oil futures rose more than $1 a barrel Monday after the death of Saudi Arabia's King Fahd, although the nation's oil policy is not expected to change now that power has formally shifted to his brother — who has been de facto leader since 1995.
With world oil consumption rising and only a limited amount of excess production capacity, energy traders are easily put on edge by a change in the weather, let alone a transfer of authority within the world's biggest oil producer. (Related: Saudi succession set.)
"The market is hypersensitive to facts, rumors and noise because the supply cushion is gone," said Larry Goldstein, president of the New York-based nonprofit Petroleum Industry Research Foundation.
Adding to oil market jitters was the resumption of uranium reprocessing in Iran. It is one step below uranium enrichment, which is necessary for the development of nuclear weapons. Iran suspended enrichment of uranium in November under international pressure, but the country maintains that it has the right to resume the activities.
Traders also kept an eye on refinery operations in the United States, where two fires last week stifled production to a limited extent.