<TABLE cellSpacing=0 cellPadding=0 width=629 border=0><TBODY><TR><TD colSpan=3>Oil traders say prices will soar
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Disruption fears continue to worry oil traders
</TD></TR></TBODY></TABLE><!-- E IIMA -->Oil traders say the re-election of US President George W Bush points to rising oil prices in the months ahead.
Traders are concerned US policy in the Middle East and unrest in Nigeria - where unions have vowed to target oil exports - could affect production.
Meanwhile, the US dollar hit eight month lows against the euro as traders worried about the US economy.
"The dollar is under pressure from various points of view," said Commerzbank economist Michael Schubert.
Concerns
President Bush's insistence that the US economy is and will remain healthy was questioned by analysts, despite the rally in the stock market which was sparked by his victory.
"Sentiment on the sustainability of the US recovery is rather negative," said Mr Schubert.
The stock market reaction was a response to the way the decisive victory removed uncertainty in the market rather than an endorsement of the President's economic vision, economists pointed out.
"Although a significant portion of uncertainty has left the markets, currency traders see no value in holding on to [dollars] in the face of the continuation of an implicitly weak dollar policy and a deteriorating budget deficit," said Ashraf Laidi, chief currency strategist with MG Financial Group.
Opec pledge
America's dependence on oil imports will do little to allay concerns about the US economy.
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Global oil prices have increased by 60% since the start of 2004 due to both supply and demand pressures, and prices could well be heading higher still.
"There are clearly upside risks to oil prices across the winter," said Deutsche Bank's oil analysts.
While demand has expanded strongly, led by China's economic boom and continuing high consumption in the US, supplies have been hit by events in Venezuela, Nigeria and Russia, as well as in Iraq and the rest of the Middle East.
The geopolitical situation is expected to continue to bolster oil prices.
US light crude has stayed above the $50 a barrel level since President Bush's victory.
"Oil rallied (due to a) belief that the second term of President Bush would increase Middle East tensions even further," said BNP Paribas in a note.
Oil prices reached a high of $55.17 a barrel on 22 October but fell by more than $5 in the run up to the US election. Some expect the bounce-back to be quick.
Forecasts of further rises now also reflect the view that President Bush is less likely to release supplies from the US strategic oil reserve than John Kerry would have been.
Some analysts even predict that he will start buying oil to further build the reserves.
Forthcoming falls
But oil prices could fall if the cartel of oil producing nations, Opec, was to increase production as pledged.
"We expect demand in 2005 to more closely match non-Opec supply growth," said Deutsche Bank's analysts.
"With Opec adding around 1.5 million barrels per day, the oil markets should recover from the recent highs."
"The US election has reportedly had some impact on oil price movements," said Opec President Purnomo Yusgiantoro. "We will monitor the extent to which the elections impact on oil prices."
http://news.bbc.co.uk/1/hi/business/3981455.stm<!-- E BO -->
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</TD></TR></TBODY></TABLE><!-- E IIMA -->Oil traders say the re-election of US President George W Bush points to rising oil prices in the months ahead.
Traders are concerned US policy in the Middle East and unrest in Nigeria - where unions have vowed to target oil exports - could affect production.
Meanwhile, the US dollar hit eight month lows against the euro as traders worried about the US economy.
"The dollar is under pressure from various points of view," said Commerzbank economist Michael Schubert.
Concerns
President Bush's insistence that the US economy is and will remain healthy was questioned by analysts, despite the rally in the stock market which was sparked by his victory.
"Sentiment on the sustainability of the US recovery is rather negative," said Mr Schubert.
The stock market reaction was a response to the way the decisive victory removed uncertainty in the market rather than an endorsement of the President's economic vision, economists pointed out.
"Although a significant portion of uncertainty has left the markets, currency traders see no value in holding on to [dollars] in the face of the continuation of an implicitly weak dollar policy and a deteriorating budget deficit," said Ashraf Laidi, chief currency strategist with MG Financial Group.
Opec pledge
America's dependence on oil imports will do little to allay concerns about the US economy.
<!-- S IIMA --><TABLE cellSpacing=0 cellPadding=0 width=203 align=right border=0><TBODY><TR><TD>
</TD></TR></TBODY></TABLE><!-- E IIMA -->
Global oil prices have increased by 60% since the start of 2004 due to both supply and demand pressures, and prices could well be heading higher still.
"There are clearly upside risks to oil prices across the winter," said Deutsche Bank's oil analysts.
While demand has expanded strongly, led by China's economic boom and continuing high consumption in the US, supplies have been hit by events in Venezuela, Nigeria and Russia, as well as in Iraq and the rest of the Middle East.
The geopolitical situation is expected to continue to bolster oil prices.
US light crude has stayed above the $50 a barrel level since President Bush's victory.
"Oil rallied (due to a) belief that the second term of President Bush would increase Middle East tensions even further," said BNP Paribas in a note.
Oil prices reached a high of $55.17 a barrel on 22 October but fell by more than $5 in the run up to the US election. Some expect the bounce-back to be quick.
Forecasts of further rises now also reflect the view that President Bush is less likely to release supplies from the US strategic oil reserve than John Kerry would have been.
Some analysts even predict that he will start buying oil to further build the reserves.
Forthcoming falls
But oil prices could fall if the cartel of oil producing nations, Opec, was to increase production as pledged.
"We expect demand in 2005 to more closely match non-Opec supply growth," said Deutsche Bank's analysts.
"With Opec adding around 1.5 million barrels per day, the oil markets should recover from the recent highs."
"The US election has reportedly had some impact on oil price movements," said Opec President Purnomo Yusgiantoro. "We will monitor the extent to which the elections impact on oil prices."
http://news.bbc.co.uk/1/hi/business/3981455.stm<!-- E BO -->
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k: Cynically LMFAO.....
