ISLAMABAD: Crude oil prices edged up for the second straight session on Tuesday amid supply concerns due to attacks on Russian energy infrastructure. As of 1225 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.06 (+0.07 percent) to reach $86.95 a barrel. Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $0.08 (+0.10 percent) to $82.80 a barrel.
On the other hand, the price of Arab Light increased by $0.97 (+1.12 percent) to reach $87.65 a barrel. Similarly, the price of Russian Sokol increased by $0.94 (+1.19 percent) to $79.98. TLTP
Following suit, the price for Opec Basket increased to $84.74 a barrel with an uptick of $0.47 (+0.56 percent).
Brent ended the last week higher by 3.97 percent, increasing to $85.34 from $82.08 a barrel. WTI also closed the week higher to $81.04 from $78.01 a barrel, registering a weekly increase of 3.88 percent.
Oil prices gained as Ukraine’s attacks on Russian refineries stoked fears of a supply disruption. The strikes on Russian refineries added $2-$3 per barrel of risk premium to crude last week, which remains in place at present. On Saturday, one of the strikes sparked a brief fire at the Slavyansk refinery in Kasnodar, which processes 8.5 million metric tons of crude oil a year, or 170,000 barrels per day. On Wednesday, Ukraine’s drone strikes resulted in a fire at Rosneft’s largest refinery. The incident stood out as one of the most severe attacks on Russia’s energy sector in recent months.
The International Energy Agency on Thursday raised its oil demand growth forecast for this year by 110,000 barrels per day, and said it expected oil markets to be in a deficit in 2024 instead of the surplus predicted by the agency earlier. The IEA said its forecast was based on the assumption that Opec+ supply cuts would continue into the second half of the year.
Opec+ members, including Saudi Arabia, the UAE and Kuwait, have extended voluntary supply cuts of 2.2 million bpd into the second quarter to stabilise the market. The producer alliance will next meet in Vienna on June 1. This week, Opec stuck to its oil demand projections for 2024 and 2025, and raised its forecast for economic growth this year, citing strong activity in the US and India.
