Market watch: NYMEX oil prices climb on US warning to Iraq

ogj.pennnet.com By OGJ editors

HOUSTON, Jan. 15 -- Crude oil futures prices rose modestly Tuesday upon comments from the United Nations chief arms inspector Hans Blix that his team found evidence of weapons-related smuggling by Iraq.

But Blix said it was unclear if the goods were linked to weapons of mass destruction. Meanwhile, US President George W. Bush issued a stern warning to Iraq that he is running out of patience.

"I'm sick and tired of games and deception," he said. "I haven't seen any evidence that he has disarmed. Time is running out on Saddam Hussein. He must disarm," Bush said of the Iraqi president.

The market already was jittery because of a huge build of US planes and ships along with thousands of troops in the oil-rich Middle East. Traders also are keeping a close eye on the general strike in Venezuela that has drastically reduced that country's oil exports.

Venezuelan President Hugo Chávez is slated to visit with UN Secretary General Kofi Annan on Thursday.

The February contract for benchmark US light, sweet crudes rose by 11¢ to $32.37/bbl Tuesday on the New York Mercantile Exchange. The March position also gained 19¢ to $31.78/bbl.

Refined products closed mixed. Unleaded gasoline for February delivery slipped by 0.74¢ to 89.16¢/gal on NYMEX. Heating oil for the same month rose by 0.78¢ to 89.16¢/gal.

The February natural gas contract lost 14.4¢ to $5.11/Mcf on NYMEX.

In London, the February contract for North Sea Brent oil gained 41¢ to $30.61/bbl on the International Petroleum Exchange. The February natural gas contract also climbed, rising 15¢ to the equivalent of $3.44/Mcf on IPE.

The average price for OPEC's basket of seven benchmark crudes climbed 39¢ to $30.21 Tuesday.