https://arab.news/w67yw
SINGAPORE: Oil prices rose as much as 1 percent on Friday as tensions persisted in the Middle East following Houthi attacks on ships in the Red Sea, according to Reuters.
Brent crude futures were up 86 cents, or 1.1 percent, to $80.25 a barrel by 7:09 a.m. Saudi time, while US West Texas Intermediate crude futures were up 81 cents, or 1.1 percent, at $74.70 a barrel.
Both the contracts are also up over 4 percent for a second consecutive week, as concern over shipping in the Red Sea buoyed prices.
Oil prices could see a rebound “due to the geopolitical conflicts and the imminent implementation of OPEC’s (the Organization of the Petroleum Exporting Countries) production cuts,” said Leon Li, an analyst at CMC Markets in Shanghai.
“So a small supply gap is likely to occur in January next year, and WTI crude oil may rise to $75-$80 per barrel.”
More maritime carriers are avoiding the Red Sea due to vessel attacks carried out in support of Palestinians by Yemeni Houthi militant group, causing global trade disruptions through the Suez Canal, which handles about 12 percent of worldwide trade.
Germany’s Hapag-Lloyd and Hong Kong’s OOCL were the latest companies to say they would avoid the Red Sea by rerouting ships or suspending sailing.
The US on Tuesday launched a multinational operation to safeguard commerce in the Red Sea, but the Houthis said they would continue to carry on attacks.
Analysts say the impact on oil supply so far has been limited, as the bulk of Middle East crude is exported via the Strait of Hormuz.
Capping further gains though, Angola’s oil minister said on Thursday that the country’s OPEC membership was not serving its interests. Angola had previously protested a decision by the wider OPEC+ group to reduce the country’s oil output quota for 2024.
The producer group in recent months has been rallying support to deepen output cuts and boost oil prices.
Saudi Arabia, Russia and other members of OPEC+, who pump more than 40 percent of the world’s oil, agreed to voluntary output cuts totalling about 2.2 million barrels per day for the first quarter of 2024.