Oil jumps $1 to record near $120 on strike

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Fresh violence in Nigeria and simmering tensions between the United States and major oil exporter Iran also helped to offset the impact of a rising U.S. dollar to boost oil prices.

U.S. light crude for June delivery rose $1.01 to $119.53 by 7:03 a.m. BST, adding to Friday's nearly $2.50 surge and briefly striking a lifetime high of $119.93 a barrel. Prices are up almost 25 percent since the start of the year.

London Brent crude rose 83 cents to $117.17.

"Supply-side concerns underpinned the oil price," David Moore, a commodity strategist at the Commonwealth Bank of Australia, said in a note to clients.

"Oil supplies from Nigeria have been disrupted by militant attacks and a strike by some oil workers. A strike at the Grangemouth refinery in Scotland has caused significant disruption to supplies from the North Sea," he said.

The 700,000-barrel-per-day (bpd) Forties crude oil pipeline was closed on Sunday as workers went on strike at the neighbouring 210,000 bpd refinery after talks over pensions fell through, operator BP said.

The refinery, owned by international chemical company Ineos, produces a tenth of Britain's petrol and diesel but also supplies vital steam and power to BP's Kinneil plant that processes the crude oil coming ashore from 70 North Sea fields.

The government has said that there will be no overall shortages of fuel but conceded that there may be some local supply problems.

BP said that assuming it got power back as soon as the strike ended and Forties fields resumed production rapidly, the pipeline could be back in operation within 24 hours but might take a few more days to get back to full flow.

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