Guardian.co.uk, Friday 30 March 2007
Oil prices shot up to their highest in over six months today on continued tension between Britain and Iran over British naval staff held by Tehran.
London Brent crude futures jumped over $1 a barrel, pushing through $69 for the first time since early last September during hectic trading. It later retreated towards $68 but dealers said any further escalation in the spat between the two countries would be immediately reflected in the oil price.
US light crude futures pushed through $66 a barrel, up more than 50 cents a barrel.
Iran's embassy in London said Britain was in close contact with the Iranian government to resolve the incident with the captured British military personnel.
"This case can and should be settled through bilateral channels. The British government's attempt to engage third parties, including the Security Council, with this case is not helpful," the Iranian embassy said.
The UN Security Council's statement on Thursday called for a swift end to the situation.
Iran broadcast footage of a second "confession" from one of its British military captives as Iran's president said the UK should apologise for "violating" Iranian waters.
The oil market was also nervous as a strike affecting a key oil hub in France threatened to shut down several refineries in the coming days.
The AA said the rises in oil prices in the past week had pushed unleaded petrol prices through 90 pence a litre and predicted it would move higher still if oil prices continued to rise. Prices are up 4p a litre since early February.
In the budget, Gordon Brown postponed the annual rise in petrol duty until September when it will go up by 2p and by the same again next March. Duty is currently 48.3p a litre.
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