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Resignation of Mubarak Drives Crude to 10-Week Low

February 11, 2011 at 21:07 by Vladimir Vyun

Crude oil declined to the lowest level in 10 weeks today in New York after Egyptian President Hosni Mubarak resigned and handed power to the military. The protesters in Egypt were demanding Mubarak to step down, causing concerns that the unrest would disrupt the supply of oil. Now, as the President agreed to the demands, traders expect more stability in the region.

Edward Morse, head of commodities research at Credit Suisse Group AG, commented on this outlook:

Oil prices have been inversely correlated to what you’d normally think of as stability. You’d normally think that if a regime were sustained, it would lead to stability.

March delivery for crude oil fell $1.15 to $85.58 per barrel on NYMEX, the lowest price since November 30. March settlement for Brent crude oil rose $0.68 (0.7 percent) to $101.55 per barrel on ICE as demand for Brent has gone up seasonally.

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