Brent gains as Middle East conflict flares
The front-month ICE Brent contract has gained by $0.64/bbl on the day from Friday, to trade at $94.15/bbl at 09.00 GMT.
IMAGE: Oil storage tanks. Getty Images
Upward pressure:
Brent crude’s price has risen at the start of the week following US airstrikes on Iranian sites over the weekend.
The US Central Command (CENTCOM) has once again targeted radar and command sites for drones in Iran – raising concerns of the fragile ceasefire to collapse.
Meanwhile, the Strait of Hormuz continues to remain closed, “disrupting more than 15mb/d [15 million b/d] of world oil supply,” ANZ Bank’s senior commodity strategist Daniel Hynes noted.
The US military called the action as “self-defense” strikes, after Iran shot down a US MQ-1 drone that was operating in the Persian Gulf.
Several vessels trying to transit the Strait have “come under attack in recent days, underscoring the risks that remain for shipowners and crew,” Hynes added.
Downward pressure:
Brent crude’s price has felt some downward pressure after Baker Hughes reported a rise in US crude oil rig activity.
The total number of rigs drilling for crude oil in the US rose by four to 429 units last week.
The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.
By Aparupa Mazumder
Please get in touch with comments or additional info to news@engine.online
