Oil falls, Turkey link may open sooner than thought

LONDON - Oil fell below $118 on Friday as supply concerns eased after an indication that a key oil pipeline through Turkey, still burning after an explosion, may come back on line earlier than some previous expectations.

By (Reuters)

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Published: Fri 8 Aug 2008, 6:54 PM

Last updated: Sun 5 Apr 2015, 11:51 AM

A fire that has shut the Baku-Tbilisi-Ceyhan (BTC) oil pipeline may be extinguished on Friday or Saturday, a senior source at Turkey's Energy Ministry told Reuters.

Once the blaze is put out, the pipeline may be brought back on line within 10 days, the official said.

Previously, the pipeline had been expected to reopen in 1-2 weeks.

U.S. light crude fell $2.06 to $117.96 a barrel by 0907 GMT.

London Brent crude dropped by $2.04 to $115.82.

U.S. crude settled $1.44 higher on Thursday as the pipeline continued to burn, stopping loadings of Azeri Light crude from Ceyhan, a key export terminal in the Mediterranean.

"People now see some stories about BTC perhaps lasting 10 days only," an analyst said.

Traders also mentioned a strengthening dollar in a turnaround from months of weakness. The dollar rose the highest in five months against the euro and a basket of major currencies.

A potentially supportive factor is the escalating fighting in Black Sea state Georgia, through which oil and gas flows to Europe.

Fighting raged around the capital of Georgia's breakaway South Ossetia on Friday as Georgian troops, backed by warplanes, pounded separatist forces in a bid to re-take control of the territory.

In Nigeria, Royal Dutch Shell said repairs continued on a pipeline sabotaged last week. And in Iran, a top U.N. nuclear watchdog official began talks aimed at improving cooperation with the International Atomic Energy Agency over the country's nuclear programme, which Iran insists is peaceful.

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