SINGAPORE, Mar 2 (AFP): Oil prices rose in Asian trade today as the market ignored healthy US crude and gasoline stockpiles to focus on geopolitical worries, particularly Nigeria, dealers said.
New York's main contract, light sweet crude for delivery in April, was up 18 cents to 62.15 from its close of 61.97 in the United States Wednesday.
US oil giant Chevron said Wednesday it had shut down one of its oil production plants in the Niger Delta, costing Nigeria 13,000 barrels per day (bpd) in lost output.
Chevron spokesman Michael Barrett said the firm had shut the Makaraba flow station after an unexplained leak on a crude oil pipeline connecting the plant to the Escravos export platform caused a minor spill.
Africa's biggest oil producer has been rocked by attacks on oil installations run by Western majors. Anglo-Dutch firm Shell has suspended production in the Delta region, cutting output by 455,000 bpd or 20 per cent.
Separatist guerrillas Wednesday released six of nine foreign oilmen they were holding captive, but warned that they would step up attacks aimed at shutting down Nigeria's oil industry.
Nigeria makes light sweet crude, which is easier and cheaper to refine than the heavy sour crude produced by oil kingpin Saudi Arabia.
Analysts said Chevron's move and continued concerns over the fallout from an impasse over Iran's nuclear activities and the insurgency in Iraq outweighed the news of a build in stockpiles in the United States, the world's biggest energy consumer.
According to the US Department of Energy, US crude oil reserves rose by 1.6 million barrels to 328.3 million in the week to February 24. That was a sharper increase than the 972,000 barrels expected by analysts.
Gasoline inventories increased by 300,000 barrels to 225.9 million, the DoE said.
But reserves of distillates, used for heating and diesel fuel, fell by 1.5 million barrels to 134.1 million, slightly more than the predicted decline of 1.3 million.
Meanwhile, a detailed scheme of China's widely watched product pricing has been handed to State Council for review, an official with the State Energy Office was quoted by media as saying recently.
In the new pricing reform, China's product prices will be pegged with international crude prices, WTI and Brent prices for instances, according to a Sinopec insider.
The insider also says the new pricing system will first change with Southeast Asian oil market and then will add in US and European oil prices as benchmarks.
It's hard to say whether the government will allow oil prices to rise to that level. After all, as a developing country, one of the central government's top priorities is to consider the average's affordability and the country's social stability.