Talk of war pushes up oil prices on markets

OIL prices surged to their highest levels in a year yesterday, on growing market fears that America would launch an assault on oil exporter Iraq after US and British planes bombed targets there on Thursday.

Dealers said the jump was partly rumour-driven, with some expecting US President George W. Bush to deliver an ultimatum to Iraqi President Saddam Hussein next week.

“It's a case of buy the rumour and sell the fact, but we haven’t had many facts yet,” said Nauman Barakat, a trader at Fimat International Banque.