Crude Oil Rally Endures

Energy futures were slightly higher at the end of Tuesday's trading session at the New York Mercantile Exchange, including a continuation of the ascent of oil.

The May contract for light sweet crude advanced 5 cents to finish at $62.96 a barrel. Heating oil rose a penny to $1.79 a gallon, and reformulated gasoline was up fractionally at $2.07 a gallon.

Natural gas climbed 24 cents to $7.49 per million British thermal unit.

Increased geopolitical tension with Iran fueled the rise in energy commodities. Iran continues to detain 15 British Royal Navy soldiers who were captured while boarding an Iranian cargo vessel last Friday. Iran says the British soldiers were in Iranian waters, but British officials are adamant that the soldiers were in Iraqi waters.

British Prime Minister Tony Blair warned that efforts to retrieve the soldiers would "enter a different phase" if Iran doesn't release them soon. He didn't elaborate on whether he was threatening military action.

If a territorial dispute over the waters separating Iran and Iraq was to erupt, "we could see a rise in shipping and insurance rates if oil tankers become more hesitant to call on Iraqi oil-export terminals which nestle the Iranian border," according to Edward Meir, energy analyst at Man Financial. That would put more upward pressure on oil prices.

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