Global oil prices hit a six-month high on Tuesday, April 2, with benchmark Brent rising above $89 a barrel for the first time since October, albeit briefly, as oil supplies faced new threats from Ukrainian attacks on Russian energy facilities and rising. conflict in the Middle East.
Brent futures for June delivery were up $1.16, or 1.3 percent, at $88.58 a barrel after touching a peak of $89.08. U.S. West Texas Intermediate (WTI) crude futures for May rose $1.23, or about 1.5 percent, to $84.94, according to Reuters news agency. Coming to domestic prices, crude oil futures rose by 1.14 percent ₹7,077 per barrel on the multi-trade exchange (MCX).
Why are oil prices rising?
-A Ukrainian drone struck one of Russia’s largest refineries on Tuesday in an attack that Russia initially repelled. A Reuters analysis of images showing the impact of the attack suggests it hit the refinery’s primary oil refining unit, which accounts for about half of the plant’s total annual production capacity of 340,000 barrels per day (bpd).
-Russia, among the top three global oil producers and one of the largest exporters of petroleum products, has battled a series of Ukrainian attacks on its oil refineries and carried out its own attacks on Ukrainian energy infrastructure.
-In the Middle East, Iran vowed revenge on Israel for an airstrike that killed two of its top generals and five other military advisers at the Iranian embassy in Damascus.
-Analysts said Israel has been at war with Iran-backed Palestinian group Hamas in Gaza, but direct Iranian involvement could spark “a region-wide conflict with a credible impact on oil supplies.
-An environmental organization said a European satellite spotted an oil spill in the northern Caspian Sea near Kazakhstan’s giant Kashagan oil field.
-The rise in prices comes ahead of Wednesday’s ministerial panel meeting of the Organization of the Petroleum Exporting Countries (OPEC) and its allies, known as OPEC+. The panel is unlikely to recommend any change in oil production policy, OPEC sources told Reuters.
-The outlook for demand rose slightly, as March data showed an expansion in Chinese manufacturing activity for the first time in six months and in the United States for the first time in a year and a half, according to official data from both nations.
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Published: 02 Apr 2024, 19:39 IST