Oil prices continued their gains, during trading on Tuesday, with US crude trading above $81, after the report of the International Energy Agency, which maintained its forecast for global demand for crude unchanged.
The rise in crude prices, supported by fears of tight inventories, despite concerns about oil demand, comes with the increase in cases of coronavirus in Europe.
Oil prices today
By 12:10 pm GMT (03:10 pm Mecca Al-Mukarramah), the prices of Brent crude futures – January 2022 delivery – rose by about 0.6%, recording $ 82.52 a barrel, but partially pared its gains after exceeding the level of 83 dollars during the session.
The price of West Texas Intermediate crude futures – for December delivery – also rose by 0.4%, recording $81.20 a barrel.
Energy Agency report
In the monthly report, released today, the International Energy Agency kept its estimates of global oil demand growth for the current and next year, at 3.4 and 5.5 million barrels per day, respectively, almost unchanged from previous expectations.
The International Agency expects the global supply of oil to rise by 1.5 million barrels per day during the months of November and next December.
With the increase in the global supply of crude, the Energy Agency said that this may mean a truce from the rise in oil prices, after rising by more than 50% since the beginning of this year.
The International Energy Agency expects a truce from the rise in oil prices
“We have very low inventory levels, and if our winters are very cold, and OPEC is still slow to increase supplies, that could push oil prices higher,” said Tony Noonan, senior risk manager at Mitsubishi Corp.
For his part, Trafigura CEO Jeremy Weir said global oil markets remain very tight with demand returning to pre-pandemic levels.
“We are seeing a very tight oil market, but it is not artificially tight because of what OPEC is doing, as the demand is there,” he added, according to Reuters.
Russian crudes sold in Asia achieved the highest spot premiums in 22 months for loading goods in January, trade sources said on Tuesday, extending gains for the fourth consecutive month, with strong demand and strong refining margins supporting prices.
However, concerns about the destruction of demand due to the Corona pandemic have limited the price hike and increased demand for raw materials.
Europe has once again become the epicenter of the spread of the COVID-19 pandemic, prompting some governments to consider reimposing lockdowns, while China is battling the largest spread due to a delta variable.
The Organization of the Petroleum Exporting Countries (OPEC) last week lowered its forecast for global oil demand for the fourth quarter, by 330,000 barrels per day from last month’s forecast, as rising energy prices hampered the economic recovery from the Covid-19 pandemic.
Last week, US rigs drilling for oil and natural gas rose for the third week in a row, encouraged by a 65% increase in US crude prices so far this year.
US shale production in December is expected to reach pre-pandemic levels of 8.68 million barrels per day, according to Rystad Energy data.
The US Commodity Futures Trading Commission said Monday that money managers raised their net US crude futures contracts and options in the week ending November 9.
The speculator group raised its position in futures and options in New York and London by 11,328 contracts to 353,807 contracts during the term.
SOURCE : REUTERS