Oil Prices Surge Amid Rising Regional Tensions
Kuwaiti and global oil prices rose due to fears of supply disruptions following attacks on Saudi Arabia.
Translated by Qiyas from الجريدة — Original source
The price of a barrel of Kuwaiti crude oil rose by 35 cents to $108.04 in Wednesday trading, up from $107.69 on Tuesday, according to the price announced by the Kuwait Petroleum Corporation.
In global markets, Brent crude prices rose yesterday morning to their highest level since May, after new attacks on Saudi Arabia sparked fears of a wider escalation of the conflict and further disruptions to crude supplies from the Middle East.
Brent futures climbed $3.35, or 3.08 percent, to $112.17 per barrel, marking their highest level since May 18. Prices reached $112.55 per barrel earlier in the session.
Tamas Varga, an oil analyst at PVM, said, “Efforts to ease tensions, whether in Ukraine or in the Middle East, lack credibility. Reports indicating that Middle Eastern oil exports exceed pre-conflict levels are countered by the intensity of attacks on ships in the Strait of Hormuz and Houthi strikes on Saudi Arabia and its oil infrastructure.”
He added, “No de-escalation is expected before the U.S. midterm elections, which will keep oil prices high.”
Analysts at Morgan Stanley estimated in a note that Middle Eastern crude exports reached approximately 17 million barrels per day last week.
U.S. officials told Reuters that the U.S. State Department ordered some diplomats and their families to leave their posts in Saudi Arabia, and is planning to withdraw families of diplomats from several other missions in the Middle East.
The U.S. Energy Information Administration announced on Wednesday that U.S. crude oil inventories fell by 3.06 million barrels to 412.5 million barrels during the previous week, while analysts surveyed by Reuters had predicted a decline of 820,000 barrels.
Data from the agency also showed that distillate fuel inventories, which include diesel and heating oil, rose by 1.68 million barrels to 104.3 million barrels, whereas expectations had pointed to a drop of 1.16 million barrels.
The U.S. Department of Energy said the Trump administration is offering to lend up to a third of its emergency heating oil reserves, totaling around one million barrels, in an attempt to curb prices that have surged due to diesel shortages stemming from the wars in Ukraine and Iran.
