LONDON, May 10 — Oil prices climbed today after a vital US pipeline was put out of action by a cyber attack, while iron ore and copper hit historic peaks on demand optimism as economies reopen.
Oil rose after the weekend attack hit the Colonial Pipeline Company, the largest in the United States and which ships gasoline and jet fuel from Texas to the East Coast, serving 50 million consumers.
The US government declared a regional emergency yesterday, while the company was unable to say when operations would return to normal.
In reaction, New York’s WTI crude and London Brent oil both gained about 0.4 per cent in value today.
‘Unnerved by cyber attack’
“Energy markets were unnerved by a cyber attack on a major US pipeline operator,” said Interactive Investor analyst Richard Hunter.
“As a result, the oil price added to the gains which were already being seen on higher anticipated demand.”
The attack comes as prices were pushing higher in response to an expected jump in demand as the world economy gets back on track as a result of the easing Covid health crisis.
Both Brent and WTI crude have gained more than 30 per cent in value since the start of the year on burgeoning optimism over a post-Covid demand recovery.
Commodities also charged higher today in part owing to dollar weakness, which makes raw materials priced in the currency cheaper for buyers using rival units.
“Commodities are powering higher on Monday, supported not only by the weaker US dollar but also by reopening optimism and hope of large-scale infrastructure spending in both US and China,” said OANDA analyst Sophie Griffiths.
“China’s benchmark iron ore rallied ... to a record high, and copper also reached a fresh record high.”
Iron ore forged new highs above US$220 a tonne, while copper struck an all-time peak at US$10,747.50 per tonne — having already hit records last week.
Elsewhere, Europe’s main stock markets wavered as investors mulled a mixed Asian session, despite another record-breaking New York performance.
Frankfurt and Paris stocks each declined 0.2 per cent in early afternoon deals, while London advanced 0.2 per cent heading towards midday.
Before the weekend, New York stocks jumped as a well-below-forecast US jobs report eased inflation concerns.
The Dow and S&P 500 finished at all-time highs, and the Nasdaq gained nearly one per cent, while the dollar was under pressure.
The British pound climbed today to US$1.4089, the highest since February 25, on dollar weakness and relief over last week’s UK elections. — AFP
