Brent crude futures climbed above $ 70 a barrel on Monday for the first time since the start of the COVID-19 pandemic. WTI crude oil reached its highest level in more than two years after the attack on Saudi Arabian facilities.
Brent crude futures for May hit $71.38 a barrel in early Asian trade, the highest since Jan. 8, 2020, and were at $71.11 a barrel by 0255 GMT, up $1.75, or 2.5%.
West Texas Intermediate (WTI) crude for April rose $1.60, or 2.4%, to $67.69. The front-month WTI price touched $67.98 a barrel earlier, the highest since October 2018.
Asian stocks soared after the US Senate approved the $ 1.9 trillion stimulus bill, while positive economic data from the US and China point well for a global economic recovery.
Yemen’s Houthi forces fired drones and missiles into the heart of Saudi Arabia’s oil industry on Sunday. Riyadh called the attack a failed attack on global energy security.
Due to such actions, we may see more rises in the market in the near term.
Brent and WTI prices rose for the fourth consecutive session after OPEC and its allies decided not to change production cuts substantially in April. The decision to keep quotas unchanged signals the group’s intention to further reduce their inventory without worrying about over-tightening the market. Increased production in some countries is seen as a low threat.
Despite the rapidly rising crude oil prices, doubts remain about a recovery in demand. India’s energy minister, the world’s third-largest crude oil importer, said higher prices could threaten a consumption-driven recovery in some countries.
High prices encourage US energy companies to add new oil and gas rigs.
