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NEW YORK - Oil prices rose Friday, with markets on edge after news that Iranian forces had seized an Iraqi oil well in a disputed border region.
New York's main futures contract, light sweet crude for January, rose 71 cents to close at 73.36 dollars a barrel, paring earlier gains.
In London, Brent North Sea crude for February delivery settled 38 cents higher at 73.75 dollars a barrel.
Iranian forces took control of a southern Iraqi oil well on a disputed section of the border on Friday, US and Iraqi officials told AFP.
"The market spiked initially (after the report)," said VTB Capital analyst Andrey Kryuchenkov, adding that the news would "limit the downside."
Andy Lipow of Lipow Oil Associates said the market was jittery over the renewed border tensions.
The oil futures market is particularly sensitive to geopolitical tensions involving Iran, the second-largest oil producer in the OPEC cartel, after Saudi Arabia.
According to US intelligence, Iran's Revolutionary Guards, an elite, ideological force of the Islamic republic, controls naval operations in the oil-rich Gulf and Strait of Hormuz, where most of the region's oil transits.
The oil well seizure comes after the Iranian government on Wednesday test-fired a medium-range missile that it said could strike Israel.
Prices also rose Friday on signs of rising energy demand in the United States, the world's biggest consumer, dealers said.
Analysts said stronger American energy demand, boosted by the need for heating fuel during the northern hemisphere winter, is likely to continue supporting oil prices.
Meanwhile, the head of OPEC (Organization of Petroleum Exporting Countries) said the cartel most likely would hold its production quotas unchanged when it meets Tuesday in the Angolan capital Luanda.
Jose Botelho de Vasconcelos, the Angolan oil minster, said in an interview with Radio Ecclesia on Friday that it was highly likely that output would be held steady as prices stabilize in a range between 75 and 80 dollars.
Saudi Arabia and other OPEC members also have expressed support for maintaining current production.
- AFP /ls
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