Oil rises above $141 on weak dlr, Israel-Iran tensions

                                
 By Fayen Wong
                                
 PERTH, June 30 (Reuters) - Oil rose over $1, back above
$141 a barrel, on Monday bolstered by a weak U.S. dollar and
continuing tensions between Israel and Iran over Tehran's
nuclear programme that had helped oil hit a record near $143
last week.
                                
 U.S. light crude for August delivery <CLc1> was up $1.30 at
$141.51 a barrel in Globex electronic trading by 2353 GMT,
trading within range of the record of $142.99 struck on Friday.
                                
 London Brent crude <LCOc1> rose 98 cents to $141.29.
                                
 "The U.S. dollar is down and there are many high-level
geopolitical news items, particularly in the Middle East, that
are pushing prices up," said Mark Pervan, a senior commodities
analyst at the Australian & New Zealand (ANZ) Bank in
Melbourne.
                                
 "Oil is now a very jittery and news-sensitive market that
is running on rumours and concerns of future supply
disruptions."
                                
 Iran's foreign minister said on Sunday he did not believe
Israel was in a position to attack his country over its nuclear
programme, while an Iranian general announced plans to prepare
320,000 graves for enemy soldiers. [ID:nL29700100]
                                
 The comments were the latest in an escalating war of words
between the arch-foes that has helped fuel speculation of a
possible Israeli attack on Iran, the world's fourth-largest oil
exporter. The speculation has helped push oil prices to record
highs.
                                
 Comments from Iran that it would impose controls on
shipping in the vital Gulf oil route if the country was
attacked [ID:nL28545577] also added to supply jitters.
                                
 The Straits of Hormuz, a narrow waterway separating Iran
from the Arabian Peninsula, accounts for roughly 40 percent of
the world's traded oil flows.
                                
 A senior Iranian oil official said he expected crude prices
to rise to $150 a barrel in the near future with the onset of
higher demand in summer, the semi-official Mehr news agency
reported on Saturday. [ID:nHOS844420]
                                
 Oil prices have jumped more than 45 percent this year,
extending a six-year rally, as supply struggles to keep pace
with rising demand from emerging economies, such as China and
India.
                                
 Additional support has come from a flood of cash from new
investors buying up commodities to hedge against inflation and
the weak U.S. dollar.
                                
 Analysts said dealers would be eyeing U.S. economic
indicators due later on Monday as well as the European Central
Bank's interest rates decision on Thursday for further guidance
on the U.S. dollar.
                                
 U.S economic indicators due Monday include the New York
National Association of Purchasing Managers' index for June and
a similar report from Chicago, due at 1300 GMT and 1345 GMT
respectively.
                                
 Oil markets are over-supplied but it would not be wise for
any OPEC exporter to tighten the taps given the risk of
exacerbating prices, Qatari Oil Minister Abdullah al-Attiyah
said on Sunday. [ID:nL29717487]
                                
 Attiyah's comments came after Libya's most senior oil
official said last week he was studying the possibility of
cutting output in response to a U.S. threats to sue OPEC
members, although he said the North African country had no
concrete plans to do so for now [ID:nL26304859].
 (Editing by Tomasz Janowski)