News / Economy

Price of Oil Hits $100 a Barrel

South Sudan army soldiers hold their weapons as they ride on a truck in Bor, Dec. 25, 2013.
South Sudan army soldiers hold their weapons as they ride on a truck in Bor, Dec. 25, 2013.

Multimedia

Audio
TEXT SIZE - +
Joe DeCapua
The price for a barrel of oil rose above $100 Friday amid concerns over instability in Libya and South Sudan, plus a growing U.S. demand for fuel.

Fighting in South Sudan and erratic oil production in Libya are having a ripple effect on the global oil market.


John Kingston, director of news for Platts, a leading energy information company, said, “The big, broad, fundamental picture does look like there’s more oil on the world [market] than is necessary. But you continue to have several hotspots that are keeping the market tight and keeping the market a little bit on edge. Libyan output’s been fluctuating. Sometimes it gets almost up to 500,000 barrels a day. Sometimes it’s closer to 100,000 barrels a day. But this is a country that should be producing about 1.5 -1.6-million barrels a day. Now you’ve got South Sudan, which is a relatively small producer, but again it could be a cutback in a market that does have a lot of these geo-political concerns.”

Some of the fighting in South Sudan is in Unity State, which produces about 45,000 to 50,000 barrels a day. That’s out of a total output for South Sudan of 250,000 barrels a day. Kingston said that’s a relatively small output compared to other oil producing nations. Nevertheless, he said the combination of problems in the two countries has affected the market.

“You’ve also got other things,” he said, “You’ve got rising interest rates, which tend to be a booster of commodities. U.S. demand is starting to show real signs of strength. It’s up about a million barrels a day – year on year – and the estimates now are that fourth quarter growth in GDP might be three to four percent, which is pretty strong. So, you throw all these together in this plunging market that everyone was talking about a few weeks ago, a month ago, it’s got too many things that are preventing it from plunging.”

Kingston said that the oil market is not like the stock market, which can fluctuate wildly upon hearing rumors.

“Any kind of commodity market – the net gain at the end of the day is zero. For every dollar made there’s a dollar lost. So that’s not the case in Wall Street. So, that’s why I always push back very hard in any kind of analogy to Wall Street. But certainly it’s not so much that there are rumors, there are real outages of supply. And even though if you sat down and did the percentages it would look really, really small, the fact is markets are not set by percentages they’re set on the margin. What is the competition for that last barrel of oil?”

Kingston said that Platts will not predict how long the price of a barrel of oil may hover around the $100 level.

You May Like

Wikipedia Proves Useful for Tracking Flu

Technique gave better results than Center for Disease Control (CDC) and Google’s Flu Trends More

Turkish Law Gives Spy Agency Controversial Powers

Parliament approves legislation to bolster powers of intelligence service, which government claims is necessary to modernize and deal with new threats Turkey faces More

Video Face of American Farmer Changing

Average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Face of American Farmer is Changingi
X
Mike Osborne
April 18, 2014
The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Face of American Farmer is Changing

The average American farmer is now 58 years old, and farmers 65 and older are the fastest growing segment of the population. It’s a troubling trend signaling big changes ahead for American agriculture as aging farmers retire. Reporter Mike Osborne says a new report from the U.S. Census Bureau is suggesting what some of those changes might look like... and why they might not be so troubling.
Video

Video Donetsk Governor: Ukraine Military Assault 'Delicate But Necessary'

Around a dozen state buildings in eastern Ukraine remain in the hands of pro-Russian protesters who are demanding a referendum on self-rule. The governor of the whole Donetsk region is among those forced out by the protesters. He spoke to VOA's Henry Ridgwell from his temporary new office in Donetsk city.
Video

Video Drones May Soon Send Data From High Seas

Drones are usually associated with unmanned flying vehicles, but autonomous watercraft are also becoming useful tools for jobs ranging from scientific exploration to law enforcement to searching for a missing airliner in the Indian Ocean. VOA’s George Putic reports on sea-faring drones.
Video

Video New Earth-Size Planet Found

Not too big, not too small. Not too hot, not too cold. A newly discovered planet looks just right for life as we know it, according to an international group of astronomers. VOA’s Steve Baragona has more.
Video

Video Copts in Diaspora Worry About Future in Egypt

Around 10 percent of Egypt’s population belong to the Coptic faith, making them the largest Christian minority in the Middle East. But they have become targets of violence since the revolution three years ago. With elections scheduled for May and the struggle between the Egyptian military and Islamists continuing, many Copts abroad are deeply worried about the future of their ancient church. VOA religion correspondent Jerome Socolovsky visited a Coptic church outside Washington DC.
Video

Video Critics Say Venezuelan Protests Test Limits of Military's Support

During the two months of deadly anti-government protests that have rocked the oil-rich nation of Venezuela, President Nicolas Maduro has accused the opposition of trying to initiate a coup. Though a small number of military officers have been arrested for allegedly plotting against the government, VOA’s Brian Padden reports the leadership of the armed forces continues to support the president, at least for now.
Video

Video More Millenials Unplug to Embrace Board Games

A big new trend in the U.S. toy industry has more consumers switching off their high-tech gadgets to play with classic toys, like board games. This is especially true among the so-called millenial generation - those born in the 1980's and 90's. Elizabeth Lee has more from an unusual café in Los Angeles, where the new trend is popular and business is booming.
Video

Video Google Buys Drone Company

In its latest purchase of high-tech companies, Google has acquired a manufacturer of solar-powered drones that can stay in the air almost indefinitely, relaying broadband Internet connection to remote areas. It is seen as yet another step in the U.S. based Web giant’s bid to bring Internet to the whole world. VOA’s George Putic reports.
AppleAndroid

World Currencies

EUR
USD
0.7217
JPY
USD
102.17
GBP
USD
0.5949
CAD
USD
1.1009
INR
USD
60.326

Rates may not be current.