Egypt may not be among the Middle East’s significant oil producers, but the country’s turmoil has placed upward pressure on oil prices nonetheless.
The most important explanation is the market’s fear that Egypt’s revolution may spread to the rest of the region. But there is also a secondary concern about the security of important transit routes across Egyptian territory.
The Suez Canal is not as important for crude oil supplies as might be thought. According the most recent figures available from the Suez Canal Authority, only 573,000 barrels per day passed through the Canal in 2009, less than half the figure for 2006.
A newsflash from Reuters has reported that a UK court has issued an injunction on the BP-Rosneft deal, which is now on hold.
This won’t come as a surprise to BP. Bob Dudley told reporters on Tuesday morning:
There is a relatively low hurdle in the UK for granting an injunction. That may well happen today.
This came after a case brought by AAR, BP’s partners in TNK-BP, who have been far from happy about the Rosneft deal.
But Dudley will not be overly concerned by such a move. Earlier, he insisted that an injunction would be merely a “time-out” in the discussions.
UPDATE – Rosneft is echoing BP’s confidence. A spokesman has said:
All the risks were expected and the London court decision should not affect the essence of the deal.
Shareholders apparently agree. BP remains about 0.5 per cent up on the day, having moved largely on its results.
Good news from the UK’s energy department today. Greenhouse gas emissions fell by 8.7 per cent in 2009, according to final official figures.
The FT reports:
The UK’s greenhouse gas emissions dropped 8.7 per cent in 2009 as the recession took its toll on fuel and electricity consumption across the economy.