Oil posted its first weekly gain in three weeks amid supply concerns as Saudi Arabia’s energy assets were attacked by Houthi rebels and Russia continued its military offensive in Ukraine. Oil prices have also rallied because of rising demand globally as economies recover from the coronavirus pandemic exceed crude production.
The National UAE reported on Sunday that Brent, the global benchmark for two thirds of the world’s oil, rose to $120.65 a barrel at the close of trading on Friday.
West Texas Intermediate, the gauge that tracks US crude, settled at $113.90 a barrel. Both benchmarks posted their first weekly gains in three weeks. Brent rose more than 11.5 per cent and WTI gained 8.8 per cent amid strong demand and supply shortage concerns. The inability of EU countries to agree on banning Russian oil and gas has also led to surge in prices.
“The EU failing to agree a ban may provide temporary relief but it doesn’t change the path of travel which is in strong demand and declining supply,” Craig Erlam, a senior market analyst at Oanda, said.
“And there’s little indication of that improving, with the rest of Opec+ happy to turn a blind eye in the absence of Kremlin support.”
EU countries were divided on whether to ban Russian oil and gas during a summit with US President Joe Biden last week.—TLTP