Terror alert fuels oil prices

13 April 2012

OIL prices soared to a 21-year record today over heightened security alerts at financial institutions in the US after officials warned of a new wave of Al Qaeda terror attack.

US light crude hit $43.92 a barrel in Far Eastern trading, a gain of 12 cents on Friday's close in America, the highest it has reached since oil futures trading began on the New York Mercantile Exchange in 1983.

'The threat alert is bringing more confusion and uncertainty to the market,' said John Brady of ABN Amro in New York.

Traders said the terrorist alert was boosting a market already tense about likely sabotage of oil installations in the Middle East and where producers are pumping oil at almost full peak to supply huge demand.

Washington declared a high-level security alert yesterday, naming the World Bank and International Monetary Fund in Washington and the Stock Exchange, Citigroup and Prudential in New York.

Tom Ridge, Secretary for Homeland Security, also suggested there could be targets in New Jersey, home to many financial services groups and the back-up facilities for many others located in New York.

Gold rose almost 1%, or $3.60 an ounce, to $397.30 in after-hours trading in New York but fell to $396 in Sydney.

The dollar fell against the euro to 1.2058 and against sterling slipped 0.21 cents to 1.8233.

Fears of a terror atrocity in London were raised today after plans for new attacks against the US and Britain were reportedly found on a computer seized during the arrest in Pakistan of a senior al Qaeda suspect.

However, the Home Office said there was no new information about a specific threat. A spokesman said: 'The threat level has not changed; it remains real and serious.'

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