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The WSJ is naming the Bhutto assassination as a contributing cause of the spike:

Oil Gains on Bhutto News, Dollar - WSJ.com

Crude-oil futures touched a fresh one-month high Thursday, boosted by the assassination of Pakistani opposition leader Benazir Bhutto, expectations of a sixth straight draw in U.S. crude oil stockpiles and a weakening dollar.

Light, sweet crude for February delivery on the New York Mercantile Exchange was recently up nine cents to $96.06 a barrel after rising as high as $96.70, the highest intraday price for a front-month contract since Nov. 27. Brent crude on the ICE futures exchange rose 26 cents to $94.20 a barrel.

Traders said while the assassination of Ms. Bhutto, who was killed during an apparent suicide bombing attack in the military garrison town of Rawalpindi, doesn't directly threaten oil supplies, it adds to global instability and a confluence of factors holding up crude oil in thin post-Christmas trading. Crude prices were buoyed Wednesday by Turkish air strikes against Kurdish rebels in northern Iraq.

"Bhutto's death is certainly no incentive to sell, and adds to a number of bullish factors at the moment, including northern Iraq and a lower dollar," said one New York trader who declined to be named.

The fact is that what we're experiencing right now is a top-down disaster. -Paul Krugman
by dvx (dvx.clt št gmail dotcom) on Thu Dec 27th, 2007 at 11:32:53 AM EST
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The assassination certainly can't help, but it matters more on pricing risk of further instability in the region.  So a little bit of a hike isn't terribly surprising.  I think stocks and the dollar have more to do with it, though.

Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Thu Dec 27th, 2007 at 12:17:14 PM EST
[ Parent ]


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