Brent gains amid global supply concerns
The front-month ICE Brent contract gained $0.66/bbl on the day, to trade at $77.90/bbl at 09.00 GMT.
PHOTO: An oil pump jack. Getty Images
Upward pressure:
Impending drone strikes launched by the US and British armed forces on Iran-backed militant factions in Yemen, Iraq, and Syria have driven Brent futures higher this week.
According to two analysts from ING Bank, the oil market, which appears to be "largely balanced" in the first quarter of 2024, “could quickly change if tensions spread to other parts of the Middle East.”
Supply concern in the oil market has taken center stage this week after the latest series of Ukrainian airstrikes on a Russian oil facility, which impacted the country’s naphtha export operations.
Downward pressure:
The news of Israel possibly agreeing to a ceasefire in the Gaza Strip has capped some of Brent’s price gains.
US Secretary of State Anthony Blinken's recent trip to the Middle East has bolstered the notion of a potential resolution to the ongoing conflict between Israel and Hamas, now in its fourth month.
Blinken met with Saudi Arabia’s de-facto leader on Monday to mediate calls for an immediate ceasefire before Israel began a severe ground assault on Rafah, which is currently home to Gaza’s majority population.
“Hopes of a ceasefire between Israel and Hamas drove some of this weakness,” ING Bank’s analysts added.
By Aparupa Mazumder
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