New: Oil Prices Up After Iraq Pipeline Bombing and Lower US Fuel Inventories

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Vienna, Austria (AP) Oil prices have spiked by more than a dollar following the bombing of a key Iraqi oil pipeline.

It's the second bombing of a pipeline this week in Iraq's southern oil port of Basra, where Iraqi forces are fighting Shiite militias.

The vast majority of Iraq's exported oil comes from fields in Basra. Today's bomb hit a pipeline that sends crude from Basra to tanks for a pair of exporting terminals in the Persian Gulf. A blast on Tuesday hit a domestic pipeline in Basra.

Iraq's oil minister had said that the clashes wouldn't affect oil exports and drilling operations. However, another official says the latest attack could have an impact on crude sales.

Light, sweet crude for may delivery had risen to just over $107 a barrel by noon in Europe in electronic trading on the New York Mercantile Exchange.