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 South Sudan's government said on Sunday rebels had seized the
capital of a key oil-producing region. Fears grew of an all-out
ethnic civil war in the world's newest country that could cut off
its 245,000 barrels per day (bpd) oil output.
This could add to the more than 1 million bpd of lost supply from
Libya where key oil ports were shut by a group demanding greater
autonomy for the country's eastern part.
February Brent crude edged up 1 cent at $111.78 a barrel by 0346 GMT
after a 2.7 percent gain last week and having touched a high of
$111.93 earlier in the session. U.S. crude for February delivery
edged down 11 cents to $99.21 a barrel.
"You've lost Libyan supply and you'll lose Sudanese supply. Although
they are not large amounts, they are significant enough to make
people nervous," said Jonathan Barratt, chief executive of commodity
research firm Barratt's Bulletin in Sydney.
"The escalation of violence in Sudan will probably start to push out
the Brent-WTI spread again," he said, adding that the spread may
widen back to $16. The spread <CL-LCO1=R> stood around $12.57 on
Monday, after narrowing nearly $9 in two weeks at the start of the
month.
South Sudan's ambassador in Khartoum said on Sunday that oil was
flowing normally although the country's main investor China National
Petroleum Company has evacuated its oil workers from the fields to
the capital Juba.
Libya's oil minister said on Saturday force should be used to reopen
key oil ports in the eastern part of the country which have been
closed for five months.
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Worries about short supplies have caused the oil market's pricing
dynamics to shift, with prompt delivery oil rising above prices for
future delivery, Saudi Arabia's oil minister said on Saturday. The
minister played down suggestions that the kingdom was ready to cut
production.
Oil also remained supported by expectations of stronger fuel demand
at the world's largest oil consumer after the U.S. economy grew at
its fastest pace in almost two years in the third quarter.
U.S. gasoline prices hit a three-month high on Friday, buoyed by
refinery strikes in France and refinery glitches in the United
States.
Workers voted to end a strike over pay at Total's Donges refinery in
western France on Sunday, the oil company said, though industrial
action continued at three other plants.
(Editing by Michael Urquhart)
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