Oil prices witnessed a notable increase on Monday, driven by concerns over potential supply disruptions stemming from ongoing tensions in the Middle East and the continued conflict between Russia and Ukraine. Brent crude, the international benchmark, saw its price rise to $87.24 per barrel in early trading, marking a 0.32% increase from its previous close of $86.96. Similarly, the American benchmark West Texas Intermediate (WTI) experienced a slight rise to $83.42 per barrel, up 0.30% from the closing price of $83.17 in the prior session.
The escalation of hostilities in the Middle East, including the unresolved conflict between Israel and Palestine and the Russia-Ukraine war, has heightened global concerns over energy supply security, contributing to the upward pressure on oil prices.
Efforts by the United Nations Security Council to broker an immediate ceasefire in the Gaza Strip have so far been unsuccessful, with Israel continuing its military operations despite international calls for peace.
In addition, the strategic Red Sea passage has become a focal point of conflict, with Iran-supported Houthi forces in Yemen targeting ships associated with Israel. In retaliation, both the United States and the United Kingdom have launched attacks against Houthi positions in Yemen, further escalating regional tensions.
Recent drone strikes on Russian refineries have also raised alarms about Russia’s ability to maintain its oil exports, which account for around 8% of the global supply. These attacks have forced temporary shutdowns, reducing refinery output and contributing to tighter global markets for refined oil products, including jet and diesel fuel.
Amid these developments, market analysts are forecasting that Brent crude prices could reach the $100 mark this year, especially in light of Russia’s announcement to cut its oil production by 471,000 barrels per day during the second quarter, adding to supply concerns.–News Desk