Oil Prices Above $62 a Barrel as Iran Siezes U.K. Soldiers

Oil prices spiked above $62 a barrel Friday, as unrest in the Middle East and Nigeria helped vault front-month contract prices to their highest level since December.

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Light, sweet crude for May delivery on the New York Mercantile Exchange gained 63 cents to $62.32 in morning trading on the New York Mercantile Exchange, after earlier climbing as high as $62.65. Friday's rise follows a surge of more than $2 a barrel the previous day after U.S. government figures showed refineries are boosting crude usage to make gasoline and other products.

The May contract for Brent crude jumped 83 cents to $63.34 a barrel on London's ICE Futures exchange.

"There's a good solid list of fundamental supports for the market," said Citigroup Global Markets energy analyst Tim Evans. "There's nothing on the other side of the scale,"

At the top of the list was Britain's Ministry of Defense saying Iranian naval vessels seized 15 British sailors and marines in Iraqi waters. Britain said the personnel were "engaged in routine boarding operations of merchant shipping in Iraqi territorial waters," and had completed their inspection of a merchant ship when they were accosted by Iranian vessels.

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Also adding to the market's worries was gunmen kidnapping three foreigners in southern Nigeria, Africa's biggest oil producer. Police said unidentified assailants waylaid a vehicle carrying an Indian and a Lebanese man in Warri and kidnapped them. In a separate incident, authorities said gunmen stormed a German construction firm in the main southern oil city of Port Harcourt and kidnapped a Dutch employee.

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More than 150 foreign workers have been seized in the Niger Delta during a year of stepped-up militant attacks and rising crime. Militants say they are fighting to force the federal government to give more oil revenues to their region and release two leaders on trial for treason or corruption charges.

The focus back on geopolitical factors came after a U.S. inventory report released Wednesday that indicated that refineries are beginning to emerge from their seasonal maintenance period, after weeks of declining utilization, and will soon start demanding more crude oil ahead of the U.S. driving season.

The Energy Information Administration reported refineries operated at 86.3 percent capacity last week, up 0.7 percent from the prior week.

Natural gas futures slipped 3.4 cents to $7.286 per 1,000 cubic feet on the Nymex, heating oil futures rose less than a penny to $1.7262 a gallon and gasoline futures rose 1.75 cents to $1.975.

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