ISLAMABAD
Crude oil prices surged for the second straight day on Wednesday, as the Middle East supply fears are back in focus.
As of 1255 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.26 (+0.34 percent) to reach $77.85 a barrel.
Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $0.35 (+0.48 percent) to $72.59 a barrel.
Brent ended last week higher by 2.23 percent, while WTI closed the week up by 3.01 percent. Both benchmarks shed more than 10 percent in 2023 on a year-on-year basis.
On the other hand, the price of Russian Sokol increased by $1.79 (+2.55 percent) to $71.90. Arab Light prices witnessed an increase of $2.01 (+2.61 percent) to reach $79.07 a barrel.
However, the price for Opec Basket decreased to $78.21 a barrel with a dip of $0.73 (-0.92 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.
Geopolitical tensions in the Middle East offered support to prices. Some major shipping firms are still avoiding the Red Sea. Germany’s Hapag-Lloyd (HLAG.DE) will continue to divert vessels around the Cape of Good Hope in the wake of maritime attacks by Yemeni Houthi militants, it said on Tuesday.
That is a 248 percent jump from $1,148 from November 21, the week the attacks began, and a 140 percent increase from $1,667 on December 23, data from London-based Drewry showed. Some of the world’s largest shipping companies have been forced to suspend Red Sea routes and redirect their vessels.
The cost of shipping goods through the Red Sea has surged since Yemen’s Houthi rebels began attacking commercial vessels in late November, and this continuing disruption may lead to higher inflation globally, industry analysts have said. Charges for transporting a 40-foot container from China to Europe through the key waterway have surged to about $4,000 at present, according to the Drewry World Container Index, which tracks container freight rates on eight major routes to and from the US, Europe and Asia.
These include Europe-based MSC, Maersk, CMA CGM and Hapag-Lloyd, and Asia-based Cosco Shipping, HMM and Evergreen Line, as well as oil and gas tanker operators.
