On Thursday, London oil futures prices were pushed up by a Kuwaiti pledge to honour its output cut commitments. Later it was the oil major Shell's announcement that it would have to freeze oil exports from its Nigerian Bonny terminal added to the upward momentum in both London and New York.

IPE Brent crude futures closed at $12.64, after gaining 14 cents following the news from Nigeria. Sources at Royal Dutch/Shell said the company would be forced to declare force majeure for a "few days" on oil exports from its Nigerian Bonny Terminal after separate shut-ins totalling about 260,000 barrels per day (bpd).

The sources told Reuters in Lagos that 60,000 bpd of crude had been shut in due to community problems at the Nembe area, a further 100,000 bpd at Ibiama due to a suspected leak and another 100,000 bpd after a spill at Ibaa, all in southeastern Nigeria. "That was just one more piece of news in a compilation of Kuwait announcing cutbacks, Tosco's crude unit shutdown and the US bombing," said one IPE dealer. "There's some very good fund short covering in the crude."

Trades said short covering after a poor performance by both crude and products, as well as the expiry of September crude futures on the New York Mercantile Exchange (NYMEX), contributed to the rises.

Nymex light crude futures for September expired at the settlement price of $13.54, 38 cents up mid-week.

US president Clinton's announcement of military strikes on alleged terrorist targets in Afghanistan and Sudan made only a limited contribution to price rises, traders on London's International Petroleum Exchange (IPE) said.

"When we heard Clinton was going to speak there were fears that it was to do with Iraq but once it was linked to the African bombings the market eased back to where it was before the announcement," said one IPE trader.

Earlier on Thursday, Kuwait said it would cut oil output in September by 60,000 barrels per day to bring its production fully into line with its pledged Opec output commitment of 1.98 million bpd. State-owned Kuwait Petroleum Corporation added in a statement that it would consider making a further reduction of 80,000 bpd in October to 1.90 million bpd.