Oil price breaches $ 71 per barrel

LONDON: New York oil prices breached 71 dollars on Wednesday, ahead of the latest update on US energy stockpiles, as traders monitored politicaltensions in major crude producer Iran.
New York's main futures contract, light sweet crude for delivery in July, gained 74 cents to 71.21 dollars a barrel.

Brent North Sea crude for August delivery advanced 70 cents to 70.94 dollars.

Jason Feer, Asia-Pacific general manager of energy market analysts Argus Media, said political problems in Iran were helping push prices higher.

"It's one of those things where when there's a possibility of a major producer in the Gulf having a problem, there will be a knee jerk reaction in the market," Feer said.

Iran's opposition movement called for a new public rally in Tehran on Wednesday as pressure was building on the regime over President Mahmoud Ahmadinejad's fiercely-contested re-election.

The Islamic republic is the second biggest crude oil producer in the Organization of the Petroleum Exporting Countries (OPEC), after Saudi Arabia.

Later on Wednesday, the US government's Energy Information Administration (EIA) will publish data on American energy stockpiles for the week ending June 12.

"Today's EIA stats could show surprising draws (falls) in crude inventories," said ODL Securities analyst Marius Paun.

The US dollar meanwhile remained under pressure after major emerging economies cast doubt on the greenback's long-term future as the world's main reserve currency, dealers said.

A weaker US currency makes dollar-priced crude cheaper for buyers holding stronger currencies. That tends to stimulate demand and push the market higher.