Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Singapore — Oil prices rose more than $1 on Tuesday to a more than seven-year high on worries about possible supply disruptions after Yemen’s Houthi group attacked the United Arab Emirates, escalating hostilities between the Iran-aligned group and a Saudi Arabian-led coalition.
The “new geopolitical tension added to ongoing signs of tightness across the market”, ANZ Research analyst said in a note.
Brent crude futures rose $1.01, or 1.2%, to $87.48 a barrel by 3.16am GMT, after earlier hitting a peak of $87.55, their highest since October 29, 2014.
US West Texas Intermediate (WTI) crude futures jumped $1.32, or 1.6%, from Friday’s settlement to a three-month high of $85.14 a barrel. Trade on Monday was subdued as it was a US public holiday.
After launching drone and missile strikes which set off explosions in fuel trucks and killed three people, the Houthi movement warned it could target more facilities, while the UAE said it reserved the right to “respond to these terrorist attacks”.
UAE oil firm ADNOC said it had activated business continuity plans to ensure uninterrupted supply of products to its local and international customers after an incident at its Mussafah fuel depot.
CommSec analysts said oil prices were being supported by colder winter temperatures in the northern hemisphere which were driving up demand for heating fuels.
The tight supply-demand balance is unlikely to ease, analysts said, as some producers within oil cartel Opec countries are struggling to pump at their allowed capacities, due to underinvestment and outages, under an agreement with Russia and allies to add 400,000 barrels a day each month.
“That should continue to be supportive for oil and increase talk of triple figure prices,” said Oanda analyst Craig Erlam.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Oil prices jump above seven-year high
Singapore — Oil prices rose more than $1 on Tuesday to a more than seven-year high on worries about possible supply disruptions after Yemen’s Houthi group attacked the United Arab Emirates, escalating hostilities between the Iran-aligned group and a Saudi Arabian-led coalition.
The “new geopolitical tension added to ongoing signs of tightness across the market”, ANZ Research analyst said in a note.
Brent crude futures rose $1.01, or 1.2%, to $87.48 a barrel by 3.16am GMT, after earlier hitting a peak of $87.55, their highest since October 29, 2014.
US West Texas Intermediate (WTI) crude futures jumped $1.32, or 1.6%, from Friday’s settlement to a three-month high of $85.14 a barrel. Trade on Monday was subdued as it was a US public holiday.
After launching drone and missile strikes which set off explosions in fuel trucks and killed three people, the Houthi movement warned it could target more facilities, while the UAE said it reserved the right to “respond to these terrorist attacks”.
UAE oil firm ADNOC said it had activated business continuity plans to ensure uninterrupted supply of products to its local and international customers after an incident at its Mussafah fuel depot.
CommSec analysts said oil prices were being supported by colder winter temperatures in the northern hemisphere which were driving up demand for heating fuels.
The tight supply-demand balance is unlikely to ease, analysts said, as some producers within oil cartel Opec countries are struggling to pump at their allowed capacities, due to underinvestment and outages, under an agreement with Russia and allies to add 400,000 barrels a day each month.
“That should continue to be supportive for oil and increase talk of triple figure prices,” said Oanda analyst Craig Erlam.
Reuters
JSE faces mixed Asian markets on Tuesday as focus shifts to earnings
Market data — January 17 2022
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Most Read
Related Articles
Brent futures rise to highest in more than three years
Markets choppy as Beijing cuts rates, Brent passes 2021 high
Published by Arena Holdings and distributed with the Financial Mail on the last Thursday of every month except December and January.