Oil Prices Hold Steady Amid Concerns Over Supply Disruptions
In the world of oil trading, all eyes are on the current geopolitical tensions that are impacting crude and fuel supplies. Recent events, such as Ukrainian attacks on Russian refineries and the potential escalation of the Israel-Hamas conflict involving Iran, have created a sense of unease among investors.
Brent Crude and WTI Futures Show Mixed Movement
As of 8:15 a.m. Saudi time, Brent crude futures for June saw a slight increase of 4 cents, reaching $88.98 per barrel. On the other hand, US West Texas Intermediate crude futures for May experienced a dip of 4 cents, landing at $85.11 a barrel. Both Brent and WTI had climbed 1.7 percent during the previous session, reaching their highest levels since October.
Supply Disruptions Loom Over the Market
The surge in oil prices was triggered by an Ukrainian drone attack on a Russian refinery, threatening to further reduce the country’s processing capacity. This development has raised concerns about a potential decline in gasoline and diesel fuel output. Meanwhile, the possibility of Iranian retaliation against Israel has added to the worries of supply disruptions in the Middle East, a crucial oil-producing region.
Market Uncertainty Persists
IG’s market strategist Yeap Jun Rong highlighted the ongoing geopolitical tensions and their impact on oil prices. The market sentiment remains bullish, with prices hitting a five-month high. Additionally, Mexico’s Pemex has sought to adjust its crude exports to accommodate domestic oil processing, further contributing to the market’s supply concerns.
US Oil Stockpile Data and OPEC+ Meeting Awaited
Early indicators suggest a decrease in US oil stockpiles, with the American Petroleum Institute reporting a 2.3 million barrel drop last week, exceeding analysts’ forecasts. The official US government inventory data is set to be released later in the day. Meanwhile, the OPEC+ ministerial panel is expected to maintain the current oil output policies at their meeting, as per sources familiar with the matter.