Brent’s global benchmark approached $ 91 a barrel, while West Texas Intermediate traded close to $ 88.
Oil is heading for its sixth consecutive weekly profit, with prices trading close to a seven-year high as crude crude begins by 2022.
West Texas Intermediate traded close to $ 88, rising about 3 percent this week, while Brent’s global index approached $ 91 as strong demand tightened global markets. As supply remains limited, a chorus of Wall Street banks and oil executives predict a $ 100 return on oil. In addition, heightened geopolitical risks, driven by fears that Russia could invade Ukraine, have also contributed to the rise in oil prices.
“Demand is strong, supply is struggling to cope with this and this is affecting the market,” said Chevron Corp. CEO. Mike Wirth on Bloomberg TV. Wirth added that geopolitical events have affected the commodity market more than in the past, and that $ 100 oil “is certainly in the realm of what we can see in the next few months.”
The stellar start of oil of the year comes despite the soft moment on world stock markets, after the Federal Reserve signaled that it is ready to deal with inflation. So far, crude oil prices have contrasted with weaker risk sentiment elsewhere, with consumption on the verge of returning to pre-pandemic levels.
Next week, the focus will be on the Organization of the Petroleum Exporting Countries and its allies as they meet on February 2 to assess the market and decide on supplies for March. Although OPEC + is gradually easing production restrictions, there are concerns that members have failed to deliver on promised volumes in full.
“OPEC + production is growing steadily, but it is still not enough to keep up with demand,” said Rohan Reddy, a research analyst at Global X Management, a $ 2 billion energy asset management company. In addition, if Russia invades Ukraine, “there is certainly some benefit to oil, because not only could sanctions affect, but theoretically their position in OPEC + will also be threatened, and they were an important voice in the room there.”
Markets are also paying close attention to Ukraine, fearing that Russia could launch an invasion after amassing thousands of troops along the border, potentially disrupting energy supplies.
- WTI with delivery in March rose $ 1.03 to $ 87.64 a barrel at 11:08 a.m. in New York.
- Brent for the March agreement rose $ 1.26 to $ 90.60 a barrel.
As a sign of market strength, prices remain strongly the opposite – an upward pattern in which short-term contracts are traded above those ahead – indicating limited immediate supply. WTI’s rapid distribution was $ 1.45 a barrel on Friday, up from 23 cents earlier this month.
With the advancement of raw materials, the prices of key products have risen. Wholesale gasoline on the New York market has risen to the highest seasonal level in three decades of record keeping. Average pump prices in the US are moving to a monthly profit, after jumping 46% last year.
- Europe’s ICE gas oil gap has jumped to its highest level in almost two years on Thursday and is set to rise further on Friday.
- Russian refineries appear poised to process much more than their own crude oil this year, potentially cutting exports.
- The decline in global diesel stocks has made the market vulnerable to price spikes.