Oil rises as Shell considers pullout

LAGOS - Royal Dutch Shell is considering a total staff pullout from the west of Nigeria's delta region because of militant attacks, a senior industry source said, threatening more supply cuts from the leading Opec oil exporter.

London Brent crude for February gained 19USc to US$62.45 ($89.42) a barrel as worries over supplies from Nigeria mount.

Heavily armed militants from the Ijaw ethnic group killed six people in a raid on a Shell platform yesterday, the fourth attack in five days, prompting the firm to withdraw 330 workers from oil flow stations in remote Niger Delta swamps.

The militant Movement for the Emancipation of the Niger Delta, also believed to be behind the kidnapping of four foreign oil workers, said in an email to Reuters it had 5000 fighters and vowed to cripple the world's eighth largest oil exporter.

The possibility of a major Shell staff pullout will increase pressure on President Olusegun Obasanjo's Government to crack down on the militants, who are demanding more control over the region's oil revenues and the release of two Ijaw leaders.

Shell is the largest oil producer in Nigeria and is widely known to be the key to US hopes of reducing dependence on supplies from the volatile Gulf. A major staff pullout is likely to trigger more output cuts in the country, already hit by the attacks.

"I think [Shell will] have to evacuate the whole of the swamps around [the city of] Warri," said an industry source who did not want to be identified.

No comment was immediately available from Shell, which normally pumps 380,000 barrels a day from the Warri region - three-quarters of it from the swamps.

- REUTERS