Crude oil was little changed after the Baku-Tbilisi-Ceyhan pipeline, which transports oil from Azerbaijan through Georgia to Turkey's Mediterranean coast, resumed oil flows.
Shipments from the Caspian began this weekend and loadings will start tomorrow, a spokesman for BP, the main operator of the a million-barrel-a-day transport link, said today. Russian lawmakers voted to recognize the independence of two breakaway Georgian regions, raising concern of new tensions in the region.
“The opening of the BTC pipeline should put downward pressure on prices while continued tensions between the West and Russia will exert upward pressure,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “I think there may be some wide swings this week because of statements from the Caspian region.''
Crude oil for October delivery fell 13 cents to $114.46 a barrel at 9:15 am on the New York Mercantile Exchange. Prices are up 61 per cent from a year ago.
Brent crude oil for October settlement rose 3 cents to $113.95 a barrel on London's ICE Futures Europe exchange.
Both chambers of Russia's Parliament called on President Dmitry Medvedev to recognise the independence of South Ossetia and Abkhazia, the two regions that sparked Russia's first foreign incursion since the Soviet era.
A Georgian operation on August 7 to retake South Ossetia led to a Russian invasion and the stationing of Russia soldiers in security zones disputed by Georgian leader Mikheil Saakashvili after a cease-fire accord.
