Oil up slightly, still supported by tensions in the Middle East

Oil prices opened slightly higher on Wednesday, still supported by geopolitical tensions in the Middle East, which raise fears of Iranian supply difficulties.


Around 9:15 a.m. GMT (11:15 a.m. in Paris), the price of a barrel of Brent from the North Sea, for delivery in December, rose 1.26% to $74.83.

Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery in September, gained 1.33%, to $71.03.

“The market remains worried about a possible Israeli response against Iran, which would cause supply problems,” explains Matt Britzman, analyst at Hargreaves Lansdown.

The military escalation of recent days between Israel on the one hand, and Iran and Hezbollah on the other, has raised fears of an uncontrollable situation in the Middle East.

An Israeli strike on a Hezbollah relief center in Beirut left seven people dead before dawn on Thursday, the day after ground fighting in southern Lebanon.

Hezbollah claims Thursday to have repulsed an Israeli attempt to advance on the border in southern Lebanon, where the Israeli army says it is carrying out limited and localized operations.

Yemen’s Houthi rebels, supported by Iran, say they have carried out a drone attack in Israel.

Despite these tensions, oil prices remain contained and their rise must be put into perspective compared to Wednesday’s session during which Brent crossed $75 before falling again on the announcement of American stocks.

According to the US Energy Information Administration (EIA), crude oil inventories increased by 3.9 million barrels last week, much more than the 1.4 million expected by analysts.

Such stocks reassure markets about an economy’s ability to withstand a possible supply shock.

“There is no immediate threat to the availability of oil at the global level,” summarizes John Plassard, analyst at Mirabaud.

Additionally, OPEC+ (Organization of the Petroleum Exporting Countries and their allies) maintained its plan to increase production by another 2.2 million barrels starting in December at a meeting on Tuesday.

“OPEC+ still has unusually large spare capacity” and could therefore produce even more if needed, underlines Claudio Galimberti of Rystad Energy.


source site-55

Latest