Oil prices up in Asian trade

SINGAPORE – Oil prices rose in Asian trade Monday on prospects for stronger US economic growth and jitters sparked by sabre-rattling over crude producer Iran’s nuclear programme, analysts said.

New York’s main contract, light sweet crude for delivery in April, gained 50 cents to $107.20 and Brent North Sea crude for April was up 32 cents to $123.97 in morning trade.

“A rosier world economy needing more energy and worries over supplies are putting upward pressure on prices,” said Justin Harper, market strategist for IG Markets in a note.

Despite US President Barack Obama’s comments on Sunday calming fears of an imminent pre-emptive strike on Iran, “the fact that it won’t happen soon is unlikely to halt creeping prices for long,” said Harper.

“Prices could still head upwards with improving economic data expected this week,” he added.

The United States is the world’s biggest oil consumer and a stronger US economy will mean greater demand.

The diplomatic row between major Western powers and Iran remains a key influence on investors’ decisions, analysts said.

Obama on Sunday criticised “loose talk of war”, and pleaded for patience in ending the nuclear stand-off with Iran, arguing that sustained international pressure would force Tehran to the negotiating table.

His comments came amid reports that Israel is eager to move more quickly and decisively against Iran’s nuclear activities, using a military strike to prevent it even reaching a point where it can decide to produce atomic weapons.

Western powers have already imposed a raft of economic sanctions on Tehran in a bid to halt its controversial nuclear programme, which is believed to mask a drive to build weapons.

Tehran denies the charge, and has warned that it could close the Strait of Hormuz — a key transit route for global oil supplies — if increased Western sanctions halt Iranian oil exports.

The Islamic republic is the world’s fifth largest oil exporter and the second biggest producer in the OPEC cartel.