Oil Rises to Record Above $118 on U.K. Strike, Nigeria Supply

Crude oil rose to a record above $118 a barrel on concern that a labor dispute in the U.K. and supply disruptions in Nigeria may crimp oil availability.
Oil rose to $118.05 a barrel in New York as unions planned to strike at a Scottish refinery in Grangemouth that receives shipments of a benchmark crude oil from the North Sea. Royal Dutch Shell Plc said yesterday 169,000 barrels a day were suspended because of attacks last week in Africa's largest producer.
``We have the strike in Scotland and the attack in Nigeria, and although it's not a huge amount of crude the market is very sensitive right now,'' said Andrey Kryuchenkov, an analyst at Sucden (U.K.) Ltd in London. ``Fundamentally, the market is tight, and investors are looking for a place for their money.''
Crude oil for May delivery rose as much as 57 cents, or 0.5 percent, to $118.05 in electronic trading on the New York Mercantile Exchange. The contract traded at $117.70 at 10:09 a.m. London time.
The May contract expires today. The more active June contract was at $117.02 a barrel, up 37 cents, at 10:14 a.m. London time.
Brent crude for June settlement rose as much as 60 cents, or 0.5 percent, to a record $115.03 a barrel on London's ICE Futures Europe exchange. The contract traded at $114.79 at 10:13 a.m. local time.

Gasoline Yield
Nigeria, the fifth-largest exporter to the U.S. last year, produces low-sulfur crude prized by refiners because of the proportion of high-value gasoline it yields. The country pumped 1.96 million barrels a day of crude in March, according to a Bloomberg survey, down from 2.4 million barrels a day at the end of 2005 as militant attacks have increased.
Ineos Group Holdings Plc proceeded with the shutdown of its 200,000 barrel-a-day Grangemouth refinery today as talks continued with a union to avert industrial action by employees. The plant takes crude from BP Plc's Forties Pipeline System, which transfers oil from more than 50 North Sea fields.
U.S. consumption of motor fuels peaks in the summer months as people drive to holiday destinations.
The country's Energy Department will probably say tomorrow that gasoline inventories dropped 2.5 million barrels last week from 215.8 million barrels the week before, according to a Bloomberg survey. All of the analysts forecast a decline.
Oil supplies advanced 1.6 million barrels in the week ended April 18 from 313.7 million barrels, according to the median of responses from seven analysts.