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Iraq: oil prices continue upwards

Wednesday, June 18, 2014 - 02:12

June 18 - Heavy fighting shuts Iraq's biggest refinery and adds to worries over crude supplies. With some analysts now eyeing prices of $125 or even $150 dollars a barrel, a joint appeal for national unity by Iraq's prime minister appears to have little or no effect. David Pollard reports.

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Some rare good news for a government under siege. These pictures are said to show the Baiji oil refinery - Iraq's biggest - under attack by ISIL militants. Shut down - its workers evacuated - but now secure in government hands, according to an army spokesman. SOUNDBITE (Arabic) ARMY SPOKESMAN GEN. QASSEM ATTA, SAYING: "We foiled the attack, killing 40 terrorists and destroying vehicles full of personnel, weapons, equipment and ammunition." The threat, though, remains - and the rhetoric ramps up. Iraq's prime minister, Nuri al-Maliki, is warning the violence gripping Iraq could spread beyond its borders. Iran's President Rouhani has issued a stark warning of his own on Shi'ite places of worship inside Iraq. SOUNDBITE (Farsi) IRANIAN PRESIDENT, HASSAN ROUHANI, SAYING: "We announce to all superpowers and their subjects, murderers and terrorists, that the great nation of Iran will stop at nothing to protect the glory of the holy sites and shrines." Iran's out-and-out participation would transform the crisis into a conflict spanning frontiers. Many Iraqis see US air strikes as preferable. Some observers question whether any intervention at all is of merit. Peter Dixon of Commerzbank. SOUNDBITE (English) PETER DIXON, STRATEGIST, COMMERZBANK, SAYING: ''To a large extent the problems in Iraq stem from Western intervention in the first place .... At least if the Americans and the Iranians are working together that gives us some hope that we have a coherent view as to what needs to be done but I think the two sides are very far apart at the moment and I rather think that this is not going to necessarily help us in the short run.'' Berenberg's senior economist Christian Schulz says there's another layer of uncertainty. SOUNDBITE (English) CHRISTIAN SCHULZ, SENIOR ECONOMIST, BERENBERG, SAYING: ''With countries like Iran but also Turkey and the southern neighbours of Iraq all potentially involved in this conflict whether there could be a chain reaction with other countries being drawn into this war or not will be one of the determinants of how long this crisis will influence markets and, of course, the oil price as well.'' Those prices are edging upwards - with some analysts targetting $125, even $150 dollars a barrel. With generous US supplies currently - and lower Chinese demand - those prices appear some way off. But, perhaps, not unreachable.

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Iraq: oil prices continue upwards

Wednesday, June 18, 2014 - 02:12