Crude Oil Price Up Again

International oil prices soared on Tuesday due to concern over the increasing violence in Iraq.

West Texas Intermediate (WTI) for May delivery at the New York Mercantile Exchange (NYMEX) was up 0.59 to $34.97. Brent crude oil traded at $31.35, up $0.66.

“Supply is not catching up with demand because the worsening violence in Iraq has disrupted oil production,” said analysts.

An expected, the statistics released on Wednesday about the U.S. oil stock shortage added to the upward momentum of crude oil price.

The average price of U.S. unleaded gasoline reached its peak at $1.77 dollars per gallon (about 3.8 liters), the American Automobile Association (AAA) reported on Tuesday.

Last week, the Organization of Petroleum Exporting Countries (OPEC) agreed to cut the production by four percent as of April 1, while placing the blame of the current oil shortage on high gas prices in the United States. Nevertheless, oil dealers expect that the overall oil production may not fall, as some OPEC members may not follow the decision.

Kwon-Heui Hong konihong@donga.com