“Brent traded near a nine-month high in London amid concern that tension with Iran may lead to disruption of Middle Eastern exports. Brent’s premium to U.S. crude narrowed for the first time in nine days.
The European benchmark was little changed after rising for a fourth week, the longest run of gains since July. Iran won’t cede to pressure to halt its nuclear work, President Mahmoud Ahmadinejad said yesterday at a rally in Tehran to mark the 34th anniversary of the Islamic Revolution. Egyptian President Mohamed Mursi’s secular opponents geared up for marches today. Bank of America Corp. said there is a “growing risk” the North Sea grade will rally to $130 a barrel.
“The recent move higher for Brent came amid a combination of geopolitical jitters over potential supply disruptions if violence escalates in the Middle East,” said Andrey Kryuchenkov, an analyst at VTB Capital in London.
Brent for March settlement was at $118.31 a barrel, down 59 cents, on the ICE Futures Europe exchange at 11:05 a.m. London time. The number of futures exchanged was 34 percent below the 100-day average. The contract increased $1.66 to $118.90 on Feb. 8, the highest since May 1. The European benchmark grade was at a premium of $22.80 to the U.S. benchmark, WTI. It closed at $23.18 on Feb. 8, the widest since Nov. 26.
The Brent-WTI spread has widened since Enterprise Product Partners LP said Jan. 31 that capacity will be limited until late 2013 on its Seaway pipeline to the Gulf Coast from Cushing, Oklahoma, the delivery point for the New York contract.
