Oil prices surpassed $106!
The price of Brent crude rose 1% in the previous session to $106.93, while WTI crude increased 1.3% to $102.65.
Oil prices rose amid escalating tensions in the Middle East. Attacks on Saudi Arabia’s energy infrastructure disrupted the operation of the country’s East-West oil pipeline. This situation has increased concerns about global oil supplies.
The price of Brent crude rose 1% in the previous session to $106.93, while WTI crude increased 1.3% to $102.65.
Market participants are concerned that an escalation of the conflict in the Middle East could disrupt oil supplies. Attacks by Iran-backed Houthi rebels on Saudi Arabia and the postponement of planned talks between the Gulf countries and Iran have increased risks.
Commercial shipping traffic in the Strait of Hormuz has also declined. Before the recent disruptions, around one-fifth of global oil supplies passed through this route. Saudi Arabia’s East-West pipeline allows around 4 million barrels of oil per day to be transported to the port of Yanbu. A prolonged disruption could reduce global supply and push oil prices even higher. Ukrainian President Volodymyr Zelenskyy said he could support a ceasefire targeting energy facilities. These risks have further strengthened expectations of higher oil prices.