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Brent hits highest since 2014 after Trump missile warning

Reuters  |  LONDON 

By Cooper

LONDON (Reuters) - Oil hit its highest in more than three years on Wednesday after U.S. threatened to fire missiles at in response to a

Some major airlines were re-routing flights on Wednesday after Europe's air traffic control agency warned aircraft flying in the to exercise caution due to possible air strikes on

Trump has criticised for standing by Syrian

"vows to shoot down any and all missiles fired at Get ready Russia, because they will be coming, nice and new and 'smart!'," he wrote in a post on on Wednesday.

Brent crude jumped to a high of nearly $72 a barrel, its strongest since early December 2014, after Trump's comments, while gold rallied for a fourth day as investors ditched risk-linked assets such as equities.

Brent rose 60 cents on the day to $71.64 a barrel by 1341 GMT, while U.S. crude futures rose 58 cents to $66.09, down from a session peak of $66.44.

The and its allies are considering air strikes against Assad's forces following a

is not a significant oil producer, but any sign of conflict in the region tends to trigger concern about potential disruption to crude flows across the wider Middle East, home to some of the world's biggest producers.

There are also concerns that the could renew sanctions against

"The focus right now is definitely on a possible military strike against Syria," said Commerzbank's head of commodity research,

"We think the fundamentals do not justify the current price, but unfortunately the market is focusing more on the and ignoring some of the warning signs, especially the hike in U.S. "

said on Wednesday that his country would not sit by and let another supply glut surface, implying that the of the Organization of the Petroleum Exporting Countries (OPEC) would continue to withhold supply.

Not all suggest the price will continue to rally strongly, analysts said.

U.S. crude inventories rose by 1.8 million barrels to 429.1 million barrels in the week to April 6, according to a report by the (API) on Tuesday, compared with analysts' expectations for a decrease of 189,000 barrels.

The (EIA) said on Tuesday that it expects domestic in 2019 to rise by more than previously expected, driven largely by growing U.S. shale output.

(Additional reporting by in Singapore; Editing by and David Goodman)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, April 11 2018. 19:47 IST
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