HONG KONG: Crude oil prices are slightly higher in Asian oil markets on Monday as concerns about the weekend attacks in Paris kick up geo-political uncertainty though the chances of a big supply disruption appeared remote.
On the New York Mercantile Exchange, light, sweet crude futures for delivery in December traded at $41.05 a barrel at 0327 GMT, up 31 cents in the Globex electronic session. January Brent crude on London’s ICE Futures exchange rose 48 cents to $44.95 a barrel.
As a result of the attack and subsequent retaliatory attacks by French forces in Syria, the risk premium on crude oil is likely to increase, said Daniel Ang, an analyst with Phillip Futures Ltd.
‘We may see some upside in oil prices, but we are not going to see a big rally,’ said Mr Ang.
The event’s impact is likely to be relatively minor and the near-term price direction is likely to be more strongly influenced by whether there were any signs of a reduction in a glut of oil supplies that have pulled prices down.
‘We remain in a market which is over-supplied,’ said Virendra Chauhan, an oil analyst at Energy Aspect.
He said the attacks are unlikely to have a significant effect on prices as Syria has remained restive for a long time.
Oil prices dropped to a near two-month low last week after U.S oil stockpiles rose for the seventh consecutive week because of a seasonal slowdown. The inventory build up has also happened as a number of refiners closed down for routine maintenance operations.
Prices have also come under pressure recently on signs that U.S. oil production is stabilizing after low prices resulted in some reductions.
