Oil Prices Up 15%; Highest in Four Years : Mideast: Iraq’s invasion of Kuwait revives fears about the security of supplies from the region.

Oil prices worldwide soared by as much as 15% to the highest level in four years today as Iraq’s invasion of Kuwait revived fears about the security of supplies from the Middle East.

A shock wave rolled through financial markets worldwide, echoing the oil embargoes of the 1970s that threw the oil-importing industrial world into an economic crisis.

And oil experts said American consumers may have to pay more to gas up their cars and heat their homes by the end of the year if oil shipments are disrupted.

Kuwaiti oil facilities were idled today.

London September futures for the world benchmark crude oil, North Sea Brent Blend, touched $24 per barrel, up $3.20 from Wednesday and the highest Brent has been since January, 1986, before easing slightly.

In a more restrained reaction in New York, the September crude oil futures contract was up $1.96 to $23.50 in early trading. Prices had already risen sharply late Wednesday as Mideast tensions began to flare out of control.

By late morning, rumors spread that Iraq might withdraw its troops. “It’s a lot more orderly here than we expected,” one New York trader said.

Analysts noted that Kuwait accounts for only about 2.2% of total U.S. crude oil imports.

“Even though Kuwait is not a major supplier of ours, we’re looking at the removal of 1.5 million to 2 million barrels per day of production from the world market,” said John Redpath of Energy Security Analysis.

Almost 25% of world oil comes from the Persian Gulf, including supplies from Saudi Arabia, the biggest exporter, as well as Iraq and Kuwait itself.

The invasion put the hand of Iraqi President Saddam Hussein, a pricing “hawk” in the 13-nation Organization of Petroleum Exporting Countries, on the throttle of 7% of the oil output--his own, plus Kuwaiti production.

In world markets, investors dumped stocks and bonds and grabbed dollars and gold as the attack triggered a flight to security in the markets.

Tokyo’s Nikkei index dropped 593 points, or 1.92% on the day.

In London, the Financial Times/Stock Exchange index of 100 stocks closed down 34 points to 2,305.0.

“People are panicking,” one Frankfurt currency trader said of the charged financial atmosphere. “There is no real logic behind it because the Iraqis already seem to have achieved everything they set out to do.”

Among refined petroleum products traded on the New York Mercantile Exchange, unleaded gasoline for September delivery jumped 5.23 cents to 69.50 cents a gallon. Heating oil was up 4.31 cents to 65.50 cents a gallon.

“The costs will have to be passed down to consumers,” said Brian Tagler, an oil trader with Shearson Lehman Hutton Inc.

But it’s hard to predict how much more consumers will have to pay, experts said.

“You may not see the impact on the consumer level for at least four to eight weeks,” said Edward Ryan, an oil trader with Dean Witter Reynolds Inc. “The current supplies on hand are adequate, and I just don’t see retail prices reacting in the same way as the wholesale level.”