Oil prices rise due to Ukraine tension

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Oil prices rise due to Ukraine tension

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Mounting tensions and military operations in Ukraine have pushed up oil prices.

The benchmark Brent crude rose over $110 a barrel at one stage on Wednesday and US light crude was also up.

Traders ignored the slower economic growth in China, which could reduce demand.

Prices were also supported by growing scepticism that exports from Libya can resume quickly or sustainably.

Libyan oil ports are gradual reopening after being blockaded by rebel groups since July.

A tanker started loading at Libya’s eastern port of Hariga on Wednesday for the first time in nearly nine months, after a federalist group agreed to reopen the port last week.

But the larger terminals of Ras Lanuf and Es Sider remain in rebel hands and their fate is subject to further negotiations with the government of the OPEC exporter.

Another price factor was scheduled work on oilfields and pipelines in the North Sea which has reduced supplies.

“It is maintenance season in the North Sea. Loading for the four grades that make up the benchmark are down for May and this also drives up Brent,” Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas, said.

“The situation in eastern Ukraine has deteriorated in the past couple of days but … no one is pricing in economic sanctions due to Russia’s interdependence with European energy needs,” he added.