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Turkey tensions lift oil prices Turkey tensions lift oil prices
(about 8 hours later)
Global oil prices have surged to fresh record highs after increased tensions between Turkey and Kurdish rebels in northern Iraq. Global oil prices have surged to fresh highs after increased tensions between Turkey and Kurdish rebels in northern Iraq and concerns over production.
In morning trade in Europe, both Brent and US light crude hit new peak levels, with Brent touching $81.93 a barrel and US light reaching $85.19. US light, sweet crude was trading at $85.85, having touched $86 for the first time, while Brent rose $1.96 to a record $82.51.
Analysts said the rises followed reports that Turkish forces had shelled an Iraqi border village overnight.Analysts said the rises followed reports that Turkish forces had shelled an Iraqi border village overnight.
Last week, 13 Turkish soldiers were killed close to the Iraqi border. And an Opec report said that non-member nations were set to cut production.
About 110,000 fewer barrels of oil would be produced each day by those who weren't part of the cartel, Opec said in a report.
Last month Opec said that it would be boosting its production by 500,000 barrels per day from the beginning of next month to cope with demand.
'Perceived risk''Perceived risk'
The Turkish government is now preparing a motion seeking parliamentary approval for a military incursion into northern Iraq. The Turkish government is now preparing a motion seeking parliamentary approval for a military incursion into northern Iraq after 13 Turkish soldiers were killed close to the Iraqi border.
Ankara estimates that 3,500 Kurdistan Workers' Party (KWP) rebels are based across the border in Iraq.Ankara estimates that 3,500 Kurdistan Workers' Party (KWP) rebels are based across the border in Iraq.
The KWP wants to see the establishment of an independent Kurdish homeland, incorporating territory in eastern Turkey and northern Iraq.The KWP wants to see the establishment of an independent Kurdish homeland, incorporating territory in eastern Turkey and northern Iraq.
Oil analyst Robert Montefusco at the Sucden brokerage in London said traders were closely monitoring the situation.Oil analyst Robert Montefusco at the Sucden brokerage in London said traders were closely monitoring the situation.
"There's no lost production at the moment, so it's only perceived that we could lose some production if any of the pipelines are affected in that region from Iraq," he said."There's no lost production at the moment, so it's only perceived that we could lose some production if any of the pipelines are affected in that region from Iraq," he said.
"That is the main concern at the moment.""That is the main concern at the moment."
The US has urged the Turkish government to show restraint.The US has urged the Turkish government to show restraint.
However, relations between Washington and Ankara are currently strained after a recent US congressional vote branding the mass killing of Armenians in 1915-17 by Ottoman Turks as genocide.However, relations between Washington and Ankara are currently strained after a recent US congressional vote branding the mass killing of Armenians in 1915-17 by Ottoman Turks as genocide.