ISLAMABAD
Crude oil prices remained mixed on Tuesday amid fears about Red Sea supply disruptions.
As of 1125 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.08 (+0.10 percent) to reach $79.15 a barrel. The West Texas Intermediate (WTI), the main oil benchmark for North America, went down by $0.14 (-0.19 percent) to $73.42 a barrel. Brent ended the last week higher by 3.29 percent while WTI registered an uptick of 2.98 percent.
Similarly, the price of Russian Sokol increased by $0.14 (+0.19 percent) to $73.36. Arab Light prices witnessed an increase of $0.15 (+0.18 percent) to reach $82.03 a barrel. On the other hand, the price for Opec Basket went down to $80.84 a barrel with a decrease of $0.40 (-0.49 percent). The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey.
Earlier, oil futures posted the biggest weekly gain since October last week due to fears about the Red Sea supply disruptions. More maritime carriers are avoiding the Red Sea due to attacks on vessels carried out by the Houthi militant group, which says it is responding to Israel’s war in Gaza. The attacks have caused global trade disruptions through the Suez Canal, which handles about 12 percent of worldwide trade.
Germany’s Hapag-Lloyd and Hong Kong’s OOCL have joined a growing list of major shipping companies that have said they would avoid the Red Sea. Hapag-Lloyd will reroute 25 ships by the end of the year from the key waterway as freight rates and shipping stocks have increased because of the disruption.
The United States on Tuesday last launched a multinational operation to safeguard commerce in the Red Sea, but the Houthis said they would continue to carry out attacks. The longevity of impact on prices is completely dependent on the length of time that shipping companies continue to steer clear of the area. What has exaggerated such impact is the lack of clarity on how, where and when the so-called naval coalition will turn up.
Meanwhile, Angola, Africa’s second-largest oil producer, announced on Thursday that it was leaving the oil producer’s alliance, following a dispute over production quotas. Angola, which joined Opec in 2007, produces about 1.1 million barrels of oil per day, compared with Opec’s production of about 28 million bpd.
The country’s exit will reduce Opec’s membership to 12 countries and its crude oil production to about 27 million bpd, or some 27 percent of the global oil market.
