Brent Crude trades at two-year highs on supply concerns

Oil futures jumped to their highest levels in more than two years in London Thursday as civil unrest spread to Bahrain in the Middle East, fueling fears that supply chain disruptions could result in delayed shipments.

Brent futures rose Wednesday to their highest price since September 2008 as political unrest spread to Bahrain, and pro-democracy demonstrations were held in Yemen and Libya, the third-biggest oil producer in the Organization of Petroleum Exporting Countries. Prices in the U.S., meanwhile, fell after inventories increased in Chushing, Oklahoma, the country's storage hub.

Tobias Merath, the head of commodity research at Credit Suisse AG in Zurich, told Bloomberg supply concerns were driving Brent Crude, sourced mainly in the North Sea, higher. "The risk premium from the whole Middle East story is more reflected in Brent," he said. "The divergence between Brent and WTI is stunning, and explained by regional factors. Oversupply at Cushing is a topic again."

Brent Crude for April settlement traded at $103.67 per barrel on ICE Futures Europe in London Wednesday; on Tuesday, prices touched $103.78 - the highest close since September 2008.

JPMorgan Chase & Co. said in a report Wednesday that political risks to oil supply are "high and rising" as unrest spreads throughout the Middle East.