Krone May Gain as Middle East Unrest Boosts Oil, Citigroup Says

The Norwegian krone may outperform currencies that rise when commodities appreciate because unrest in Egypt and the Middle East is boosting crude oil, while weakening “risk appetite,” according to Citigroup Inc.

The krone is “well positioned to gain from higher oil,” Todd Elmer, Singapore-based head of Group-of-10 currency strategy for Asia excluding Japan, wrote in an investor report today. “Political tensions in the Middle East have contributed to a pullback in risk appetite. However, it also looks to have stemmed the decline in oil prices.

‘‘There is some concern that we will see further political contagion across the region, which is seen as threatening disruption to oil supplies and higher prices,’’ Elmer wrote in an e-mailed response to questions.

The krone was little changed at 5.8124 per dollar as of 7:21 a.m. in London. Brent crude oil rose as much as 0.6 percent to $99.97 per barrel.

To contact the reporter on this story: Paul Dobson in London at pdobson2@bloomberg.net

To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net