Zeev's Turnips Talk Politics (ZTTP)

[Rick Faurot]

Oil Hits New High as Iraq Fighting Rages
Thu Aug 12, 2004 11:10 AM ET

LONDON (Reuters) - Oil prices hit fresh record highs on Thursday as U.S.-led forces sought to crush a rebellion in the holy Iraqi city of Najaf, a move which Shi'ite Iraqi militia have warned could trigger fresh attacks on oil infrastructure.
U.S. light crude rose 65 cents to $45.45 a barrel, the highest price in 21 years of trade on the New York Mercantile Exchange. London's Brent crude futures rose 51 cents to hit a new peak of $42.08.

Iraq's oil exports have run at half normal levels for the last four days as an uprising by an anti-U.S. cleric threatens infrastructure in southern production centers.

U.S. marines launched a major offensive in Najaf on Thursday to root out militiamen loyal to Shi'ite Muslim cleric Moqtada al-Sadr. Sadr's militia has threatened to blow up oil pipelines if U.S. forces storm Najaf.