2024-01-05T04:32:32+00:00
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/ Oil prices rose, consolidating their weekly gains, as rising tensions in the Middle East and North Africa overshadowed signs of weak American demand.
Brent crude traded near $78 a barrel after falling 0.8% yesterday, Thursday, as US gasoline inventories swelled at the largest pace in three decades.
West Texas Intermediate crude was below $73. Energy Information Administration data showed that implied US demand for gasoline – a volatile figure – fell to its lowest level in a year.
Tensions escalated in the Middle East and North Africa this week, as US Secretary of State Anthony Blinken headed to the region for the fourth time since the Hamas attack on Israel in early October.
ISIS claimed responsibility for an explosion that occurred in central Iran, killing nearly 100 people. Tehran had previously said that the explosion aimed to punish its stance against the Israeli invasion of Gaza.
Demonstrators in Libya disrupted supplies from the Sharara and El Feel fields, which could lead to the exit of about 300,000 barrels per day from the market. Meanwhile, the armed Houthi group in Yemen claimed responsibility for another attack on a commercial ship in the Red Sea.
Despite the geopolitical turmoil, the outlook for crude oil demand continues to look fragile. Wall Street is already cutting oil price forecasts for this year after global benchmark Brent crude fell by about a fifth in the last quarter. It is expected that the increase in supplies from outside the OPEC+ alliance, led by American shale oil drilling companies, will continue, while consumption growth is expected to slow.
Energy Information Administration data showed that crude inventories in Cushing, Oklahoma, rose for the eleventh week in a row to their highest levels since last July, despite a decline in inventories nationwide.