Brent Prices Spike As Egyptian Death Toll Rises
Brent crude oil prices jumped on Thursday after tension in Egypt escalated and reignited worries that the nation's conflict would shut down the Suez Canal, where much of the world's crude oil passes. The commodity traded at $111.28 at 8:44 GMT on Thursday morning.
CNBC reported that a state of emergency has been declared in Egypt after riot police and ousted President Mohamed Morsi supporters clashed in deadly riots.
Egypt has been in a fragile state since the first freely elected president was overthrown. Although Egypt itself is not an oil producing country, many worry that the conflict in Egypt could spill over the nation's borders and create tension in an already unstable region.
Supply worries in Libya also kept Brent prices afloat as labor protests kept the nation's largest oil export terminals from operating normally. Libyan oil output has dipped to 600,000 barrels per day in the wake of the protests.
Economic data from Europe also helped support crude prices as the figures indicated that the recession hit eurozone was finally making a comeback. GDP data showed higher than expected growth for the 17 nation bloc as a whole, with Germany and France leading the way. The data confirmed that a modest eurozone recovery was on the horizon.
Recent data from the US also points to growing oil demand; however investors are worried that the positive economic data will prompt the US Federal Reserve to begin tapering its stimulus plan in September. US retail sales figures showed the nation's consumer spending was on the rise, something that many believe will contribute to the Fed's decision to wind down its $85 billion per month bond buying plan.
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