Crude oil futures soared to a record high since September 2009 on Friday on concerns that anti-government protests in Egypt would spread to other oil-producing countries in the Middle East.
Oil prices neared $90 a barrel at one point in the trading day, an increase of over 4%, before retreating in early afternoon trade. Oil for March delivery rose $3.70, or 4.3%, to settle at $89.34 a barrel on the New York Mercantile Exchange.
Linda Raschke, partner at FuturePath Trading, said, "The crisis in Egypt as well as the significance of a government shutting down the Internet for the entire country is causing major nervousness in market participants that have been long equities in front of the weekend."
Although Egypt is not a significant oil exporter, it is home to the Suez Canal, a major shipping channel between the Red Sea and the Mediterranean. The U.S. Energy Information Administration estimated that 1.8 million barrels of crude and refined petroleum passed through the Suez Canal per day in 2009.
In addition to pumping up oil prices, Egypt's unrest has driven investors to move away from equities toward the dollar, prompting stocks to fall and the greenback to gain.
Raschke noted that investor fears of regional instability could make crude oil a "major benefiting market."
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