International Oil Prices Hit New Record High

The political unrest in the Middle East has again sent international oil prices to a record high. Stock prices in Asian nations, including Korea, fell simultaneously.

The spot price of the West Texas Intermediate (WTI) on Tuesday was up $2.42 to $42.36 per barrel, the new record high in eight days, reported the Korea National Oil Corporation on Wednesday.

The futures price of WTI at the New York Mercantile Exchange (NYMEX) was up $2.45 to close at a record high of $42.33. The extent of the price increase was the highest in 14 months since March 24, 2003.

The Brent Crude Oil spot price was up $1.70 to $38.72, and its futures price was up $2.50 to $39.08 at the International Petroleum Exchange of London (IPE). The price of Dubai Crude Oil rose $0.38.

Last week’s terrorist attacks in Saudi Arabia spread the fear of oil supply disruption, causing the jump in crude oil price.

The Korean Stock Price Index (KOSPI) on Wednesday fell under 800 during the day but rebounded to close at 804.39, 11.38 points lower than the day before.

The Japanese Nikkei Stock Average Index fell 0.48 percent to 1,1242.34 yen, and the Taiwan Stock Price Index was also down 1.85 percent.

The Asian Wall Street Journal reported Wednesday that Asian economies have been hit the hardest since they import most of this oil.

“Surging oil prices pose more serious danger to Asia than slowing down the Chinese economy, and the hikes might delay the current economic recovery of Asian nations,” Citigroup analyzed in its report on the economic prospect in Asia.

“The OECD members will meet in Beirut, Lebanon on Thursday and will agree to increase production by 2.5 million barrels per day,” said Saudi Arabia Oil Minister Ali Al-Naimi.

Ki-Jeong Ko Yong Park koh@donga.com parky@donga.com