LAGOS, Nigeria -- A week-long offensive by the Nigerian army to destroy militant camps in the oil-rich Niger Delta continued Wednesday, a day after Italian oil major Eni SpA declared force majeure on 52,000 barrels per day of crude production from the country.
The fighting helped push oil prices higher, though they got the biggest lift from a U.S. government report that inventories were falling faster than expected. In late trading in New York Wednesday, U.S. benchmark crude was up $1.94 per barrel, or 3.23%, at $62.04.
The fighting is the latest in years of battles between militants on one side and oil companies and Nigeria's security services on the other, though it had subsided somewhat since October. Occasional outbreaks since then had been brief and drew little attention from global crude markets after prices fell sharply from highs last summer.
Now that oil is climbing again, the Nigerian violence poses fresh upward pressure on prices, though the impact of the latest fighting between the Nigerian military's Joint Task Force and the militants is still spotty. The Nigerian state-run oil company has said that oil production has been largely unaffected by the recent fighting.
The task force and Nigeria's main militant group, the Movement for the Emancipation of the Niger Delta, or MEND, have been trading accusations since last week, when the task force launched an unusually intense "search and cordon" mission against the delta militants. The operation has employed fighter jets, helicopter gunships and gunboats against suspected hideouts in creek-side villages outside the southern delta town of Warri.
The task force claims to have destroyed several camps, killed dozens of militants, recovered large arms caches and rescued Filipino and Ukrainian hostages. MEND claims that the military is killing civilians and hostages alike with an erratic and inaccurate display of firepower.
Many analysts say that if the task force's current offensive, so far limited to western Delta State, expands to other parts of the delta to pursue other suspected militants, it could signify a shift in government policy toward the region. Instability in the Niger Delta has led to the kidnapping of more than 200 foreigners since 2006 and shut in nearly a quarter of Nigeria's oil production. (From THE WALL STREET JOURNAL)
googletag.cmd.push(function() { googletag.display('content1'); });
googletag.cmd.push(function() { googletag.display('comments'); });
googletag.cmd.push(function() { googletag.display('content2'); });