Oil prices rose 3% at the end of Thursday’s trading session, reaching their highest level since December. Analysts attribute the price rise to faster-than-expected U.S. economic growth and rising geopolitical tensions in the Red Sea.
The price of Brent crude oil traded in Europe rose by $2.39 to $82.43 a barrel. U.S. WTI crude oil rose $2.27 to $77.36 a barrel.
Geopolitical tensions in the Middle East and concerns over the safety of shipping in the Red Sea continue to weigh on oil prices.
Maersk, one of the world’s largest shipping companies, said the explosions forced two of its U.S. subsidiary’s ships to turn away as they were moving off the coast of Yemen.
“We are finally seeing energy markets recognize the very real possibility that these supply chain disruptions will continue for several months. The possibility of a military solution to ensure navigation is unlikely,” Joshua Mahony, an analyst at Scope Markets, told Reuters.
The continued shipping disruptions were also prompted by the Houthi rebel leader’s statement on Thursday that the group would continue to attack merchant ships it believed were linked to Israel. However, ships that do not belong to Israeli companies or transport goods to Israel have also been attacked.
Furthermore, news from the USA influenced the performance of the markets.
Last week, US oil inventories fell by 9.2 million barrels. Cold weather in many states has led to higher-than-expected oil consumption.
Additionally, it was revealed on Thursday that the US economy grew faster than analysts expected in the fourth quarter of last year. Faster economic growth means greater oil consumption, which also supports higher prices.
Additionally, China’s central bank on Wednesday reduced the reserve requirement ratio of commercial banks, promising to increase the volume of loans issued.
Markets have been waiting for several months for Chinese authorities to support economic growth, and the central bank’s decision could support oil demand, John Kilduff, an analyst at Again Capital, told Reuters.
2024-01-26 04:41:00
oil-prices-rose-3-on-thursday-foreign-country