Oil climbs to near $88 as Egypt unrest escalates

[February 11, 2011]  SINGAPORE (AP) -- Oil prices climbed to near $88 a barrel Friday in Asia as Egyptian President Hosni Mubarak clung to power amid growing protests calling for his resignation.

Benchmark crude for March delivery was up 96 cents at $87.69 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents to settle at $86.73 on Thursday.

In London, Brent crude gained 86 cents to $102.30 a barrel on the ICE Futures exchange.

Mubarak, in power for 30 years, said late Thursday that he would pass some authority to his vice president but would not immediately leave office. Protesters seeking to oust Mubarak were massing in Cairo's central square on Friday, posing a major test for the military as the demonstrators stepped up calls for the army to intervene against the president.

Egypt is not a major oil producing country, but it controls the Suez Canal and a nearby pipeline. Egypt's political crisis, which is entering its 18th day, hasn't disrupted oil supplies, but traders are concerned the upheaval could spread to other countries in the oil-rich region.

"There are renewed fears that the events in Egypt will be copied elsewhere throughout the Middle East," Cameron Hanover said in a report. "The possibility of other countries in the region coming under similar assaults seems to grow."

In other Nymex trading in March contracts, heating oil rose 2.1 cents to $2.73 a gallon and gasoline gained 2.4 cents to $2.49 a gallon. Natural gas futures were down 2.7 cents at $3.96 per 1,000 cubic feet.

[Associated Press; By ALEX KENNEDY]

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