NEW YORK (AP)–Oil prices jumped back above $120 a barrel Thursday, halting a steep three-day slide after Kurdish rebels claimed responsibility for a fire at the key Turkish pipeline that supplies Western countries.
Light, sweet crude for September delivery advanced $1.53 to $120.10 a barrel in late-morning trading on the New York Mercantile Exchange, after earlier rising as high as $121.78. Crude sank more than $6 over the previous three days, bringing prices $30 lower than its July high above $147 a barrel.
Oil could be expected to rebound at some point after such a big drop, and Thursday’s news provided traders with an incentive to buy. Pro-Kurdish news agency Firat said the Kurdistan Workers’ Party, known as PKK, admitted sabotaging the Turkish section of the critical Baku-Tbilisi-Ceyhan pipeline Tuesday night.
Turkey’s state-run Anatolia news agency reported that the fire, which was still burning as of early Thursday, could cause the pipeline to be shut down for up to 15 days, stirring supply concerns among oil market traders.
The pipeline has allowed the West to tap the rich fields of Azerbaijan, bypassing Iran and Russia.