21 Feb 2012

Oil price rises after Iran halts sales to UK, France

9:58 am on 21 February 2012

The price of oil has reached its highest level since mid-2011, due to rising tensions over Iran's nuclear programme.

Benchmark US light crude rose 1.7% to $US105.01 a barrel and Brent crude futures rose $US1.14 to $US120.72 a barrel.

The increase follows the announcement by Iran on Sunday that it has stopped selling oil to French and British companies.

Analysts say the price of oil has risen as European Union countries seek to find new oil suppliers and Iran hunts new buyers, the BBC reports.

Iran is the world's fifth largest oil exporter.