Supply concerns and political tensions in Eastern Europe and the Middle East kept prices on track for their biggest monthly gains in nearly a year.
see photosOil prices are showing signs of warming as traders anticipate severe shortage of petroleum
Oil rose more than 1% on Monday to hit a 7-year high in the previous session, while supply concerns and political tensions in Eastern Europe and the Middle East kept prices on track for their biggest monthly gain in nearly a year . Brent crude rose $1.07, or 1.2%, to $91.10 a barrel by 0325 GMT, after adding 69 cents on Friday. The front-of-the-month contract for March delivery expires later in the day. The most active Brent contract, for delivery in April, was trading up 99 cents, or 1.1%, at $89.51. US West Texas Intermediate crude was up 21 cents on Friday, up $1.07, or 1.2%, to $87.89 a barrel.
The benchmarks on Friday posted their highest levels since October 2014 at $91.70 and $88.84, respectively, marking their sixth consecutive weekly gain. They were headed for a nearly 17% gain this month, the highest since February 2021.
“Inherent concerns about global supply crunch, coupled with ongoing geopolitical risks, have led the market to start the week on a strong note,” said Toshitaka Tajawa, an analyst at Fujitomi Securities Co Ltd.
“Oil prices will remain bullish this week with the expectation that OPEC+ will maintain the current policy of gradual increase in output,” he said, predicting Brent to stay above $90 and WTI to move towards $90. Said happened.
Major producers of the Organization of the Petroleum Exporting Countries (OPEC) and Russia-led allies, collectively known as OPEC+, raised their production targets by 400,000 barrels per day (bpd) every month since August. given as they take the record production cuts made in 2020. ,
OPEC+ is likely to keep up with the planned increase in its oil production target for March, several OPEC+ sources told Reuters
But they have failed to meet their production targets as some members are facing capacity constraints.
At its February 2 meeting, OPEC+ is likely to stick with the planned increase in its oil production target for March, several OPEC+ sources told Reuters.
more warm
Oil prices are showing signs of warming as traders anticipate severe petroleum shortages this year, Reuters columnist John Kemp said, noting that inventories were already low and there was little room to increase production in the short term. There was less global spare capacity.
According to ANZ Research, due to market losses and low inventory, “supply constraints will potentially induce a large risk premium” as travel picks up.
“Traffic is resuming in Europe as Omicron case numbers decline. In the US, gasoline demand is down just 4% from 2019 levels, a better-than-expected result in November,” a note said. Is.”
Traffic is restarting in Europe as Omicron case numbers drop. In the US, gasoline demand is only 4% below 2019 levels
Tensions between Russia and the West have also driven down crude oil prices. Russia, the world’s second largest oil producer, and the West are at loggerheads over Ukraine, fearing energy supplies to Europe could be disrupted.
The NATO chief said on Sunday that Europe needed to diversify its energy supply as Britain warned it was “highly likely” that Russia would want to invade Ukraine.
Markets are also cautious on the situation in the Middle East as the United Arab Emirates said it had intercepted a ballistic missile fired by Yemen’s Houthi as the Gulf state hosted Israeli President Isaac Herzog in the first such visit.
Meanwhile, more than 1,400 US flights were canceled on Sunday after a deadly winter storm struck the US northeastern states the day before, prompting several states to declare a state of emergency.
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