Oil Surges to Record as King Fahd’s Death Raises Supply Concern

Crude oil rose to a record $62.30 a barrel after the death of Saudi Arabia’s King Fahd heightened concern about the stability of the world’s largest oil exporter.

The monarch’s half-brother, Abdullah bin Abdulaziz al-Saud, who assumed day-to-day power after Fahd’s 1995 stroke, becomes king. Prince Sultan bin Abdulaziz, Minister of Defense, becomes Crown Prince. The kingdom is battling al-Qaeda, which has killed almost 100 foreigners in the country during the past two years. Prices also rose on refinery disruptions in the U.S. and Europe.

“This lays bare the fact that there’s a succession problem and it’s an opportunity for al-Qaeda to make trouble,” said Bill O’Grady, assistant director of market analysis at A.G. Edwards & Sons in St. Louis. “Abdullah and Sultan are both about 80, so we can’t expect them to sit on the throne after five years.”
Bloomberg