Connect with us

Top Stories

Oil prices rise on supply disruption jitters as geopolitical tensions grow

Oil prices rise on supply disruption jitters as geopolitical tensions grow 1

By Yuka Obayashi

TOKYO (Reuters) – Oil prices climbed on Tuesday, regaining some of the ground lost in the previous day’s sharp losses, on concerns over possible supply disruptions amid rising geopolitical tensions in both Eastern Europe and the Middle East.

Brent crude futures rose 48 cents, or 0.6%, to $86.75 a barrel at 0116 GMT, reversing a 1.8% fall in the previous session.

U.S. West Texas Intermediate (WTI) crude futures climbed 34 cents, or 0.4%, to $83.65 a barrel, having slid 2.2% on Monday.

Oil prices reached seven-year highs last week, bolstered by tight worldwide supply and resurgent global demand.

“The market tone stays strong, supported by heightening geopolitical risk,” said Chiyoki Chen, chief analyst at Sunward Trading.

“We saw profit-taking on Monday when the prices moved higher and as Wall Street temporarily sank amid concerns over the U.S. Federal Reserve’s policy to reduce economic stimulus, but buying appetite for oil remained solid,” he said.

A tumultuous day on Wall Street saw stocks end higher after posting heavy losses earlier in the day, as uncertainty over the rising geopolitical tensions and Fed policy boosted safe havens. [MKTS/GLOB]

NATO said on Monday it was putting forces on standby and reinforcing eastern Europe with more ships and fighter jets, in what Russia denounced as Western “hysteria” in response to its build-up of troops on the Ukraine border.

In the Middle East, Yemen’s Houthi movement, aligned with Iran, launched a missile attack at the United Arab Emirates on Monday that targeted a base hosting the U.S. military, but was thwarted by U.S.-built Patriot interceptors, U.S. and Emirati officials said.

Meanwhile, lower U.S. oil inventories are also providing support, with crude inventories around the NYMEX WTI delivery point at Cushing in Oklahoma at the lowest for the time of year since 2012.

Portfolio investors added to their bullish positions in oil for the fifth week running, as the worst of the latest wave of coronavirus infections passed and governments began to lift restrictions on business and travel.

(Reporting by Yuka Obayashi; Editing by Kenneth Maxwell)

Editorial & Advertiser disclosure
Our website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.
Global Banking and Finance Review Awards Nominations 2022
2022 Awards now open. Click Here to Nominate

Advertisement

Newsletters with Secrets & Analysis. Subscribe Now