Oil up on continued fighting

Expectations of escalation in Lebanon and sabotage to a pipeline in northern Iraq sent crude oil prices up again on Tuesday.  Brent crude for September delivery was up $1.37 in late afternoon trade in London to $76.52 per barrel, bringing its total gain since Friday to over $3 per barrel.  By late morning on the New York Mercantile Exchange, September contracts for West Texas Intermediate crude was 90 cents higher to $75.50 per barrel.

Petroleum products also saw price hikes after the chief executive of Valero, the largest independent refiner in the United States, said that slow growth in refining capacity, combined with demand growth and tighter fuel specifications will keep supplies tight for the time being.  Nymex unleaded gasoline September contracts were up 7.07 cents to $2.2825 per gallon, while September Nymex heating oil was 4.84 cents higher to $2.0860 per gallon.