Oil up, global supply down

(New York) Oil prices climbed Thursday on the eve of a long weekend where many markets will be closed on Friday and Monday, in a geopolitical context of fears of drops in supply from several regions of the world .


The price of a barrel of Brent from the North Sea, for delivery in May, rose 1.61% to $87.48.

Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery the same month, gained 2.23% to $83.17.

Since the barrel of WTI again exceeded the threshold of 80 dollars in March, “this threshold acts as a floor whereas it was previously a ceiling”, underlined Matt Smith of Kpler.

The two global references are benefiting from supply problems or fears of shortages around the world.

“Russia’s production and export prospects have gradually deteriorated due to Ukrainian drone strikes,” explained Tamas Varga, analyst at PVM Energy.

Ukraine, faced with the Russian offensive for two years, has increased its attacks against Russia in recent weeks, particularly targeting energy sites.

“The Ukrainians are realizing that they can hit the Russians the most with drone attacks and this is starting to show in the Russian diesel export figures,” Matt Smith also noted.

The analyst underlined that “the geopolitical context but also the desire of OPEC “to maintain its production cuts have provided support for crude prices”.

Regarding global crude supply, Tamas Varga speaks of a “strong consensus that global oil stocks will be depleted throughout the year”, given that “demand is reaching unprecedented levels” and that “OPEC” appears to be sticking to its self-imposed production constraints, at least until June.”

The Organization of the Petroleum Exporting Countries and its allies in the OPEC+ alliance will hold a technical meeting on April 3 of their Joint Ministerial Monitoring Committee (JMMC).


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