Source : INDIA TODAY NEWS
Brent crude prices crossed the $100-a-barrel mark on Wednesday, returning to the psychologically important level for the first time since July 24 as the escalating Middle East conflict heightened concerns over disruptions to oil supplies.
Brent futures rose as much as 2.2% to $100.07 a barrel.
As of 1:31 PM, Brent was at $99.60 a barrel, up $1.68 or 1.72%, while US West Texas Intermediate (WTI) crude was trading at $94.15, up $1.12 or 1.20%.
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The latest surge extends a sharp rally in crude prices. Brent has gained around 25% since early August, with markets increasingly worried that the prolonged US-Iran conflict could further disrupt oil flows from the Middle East.
Fresh attacks by Iran-backed Houthis on Saudi energy facilities have added to those concerns, with oil installations reportedly set ablaze. The attacks have raised fears of disruption to crude shipments through the Red Sea, an important alternative route to the Strait of Hormuz.
Oil flows through Hormuz have already been severely curtailed since the Iran war began on February 28. Before fighting resumed on August 30, around 8 million to 9 million barrels per day (bpd) of crude had been moving through the strait, according to Rystad Energy. More recently, flows have fallen below 2 million bpd.
The prospect of prolonged supply disruptions has also prompted several major banks to raise their oil price forecasts. Goldman Sachs, Bank of America and HSBC are among those that have revised their crude outlooks higher in recent days.
Despite increased production from non-OPEC producers such as the US, Canada and Guyana, the International Energy Agency expects global oil supply to decline by 4.3 million bpd, or around 4%, this year.
The move above $100 is therefore being driven not just by the latest attacks, but by growing concerns that the conflict could increasingly affect the region’s ability to move crude to global markets.
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SOURCE :- TIMES OF INDIA
