Spot oil price creeps up

Press, 23 October 1980, Page 6

Spot oil price creeps up

NZPA-Reuter London After one month of fighting between Iraq and Iran, crudeoil prices in the free market have risen about 20 per cent and are still edging up because of the prospect that supplies from the two countries will be lost for some time. Western oil companies are also growing increasingly anxious that official Government prices for the much bigger volume of crude which is sold under. contract might follow the free market’s lead if the. war does not end soon. One Organisation of Petroleum Exporting Countries producer, the United Arab Emirates, announced a SUS2 a barrel increase on October 15, despite a price freeze intended to last until mid-De-ember which ' was agreed just before the Gulf War broke out by the 13 members of O.P.E.C. > ' • The U.A.E said that is increase, raising its Murban crude to 5U533.36 dollars for a 42- U.S.-gallon barrel, was planned before the war. A spokesman of one big

Western oil company said yesterday that other Gulf producers had provided “general intimations they would not raise prices during the conflict.” He recalled, however, that during the past two years an increase by one OP.E.C. producer had tended to trigger increases by the others. “This does not seem to have happened in this case but there is always a period of wait-and-see and we are not out of that yet,” he said. Very little crude trades on the spot market but it is the industry’s price barometer. Free-market prices have often been cited by O.P.E.C. to justify raising Government selling rates. London traders said yesterday that the spot price of Arabian light crude rose steadily last week and continued to firm this week to just above SUS 37 a barrel. This compares with the official Saudi price of SUS3O and a' spot rate only just above that before Iraq and Iran started fighting four weeks ago. I