Brent oil nears $80 a barrel on tight supply

imageCommodities55 minutes ago (Sep 27, 2021 10:11AM ET)

(C) Reuters. FILE PHOTO: Oil drills are pictured in the Kern River oil field in Bakersfield, California November 9, 2014. REUTERS/Jonathan Alcorn/File Photo

By Noah Browning

LONDON (Reuters) -Oil prices rose for a fifth straight day on Monday with Brent at its highest since October 2018 and heading for $80 amid supply concerns as demand picks up in parts of the world with the easing of pandemic restrictions.

Brent crude was up $1.63 or 2.1% at $79.72 a barrel by 1403 GMT, having posted three straight weeks of gains. U.S. Oil added $1.56, or 2.1%, to $75.54, near its highest since July, after rising for a fifth straight week last week.

Goldman Sachs (NYSE:GS) raised by $10 its forecast for Brent crude at the end of this year to $90 per barrel, as faster fuel demand recovery from the outbreak of the Delta variant of the coronavirus and Hurricane Ida’s hit to U.S. production led to tight global supplies.

“While we have long held a bullish oil view, the current global supply-demand deficit is larger than we expected, with the recovery in global demand from the Delta impact even faster than our above-consensus forecast and with global supply remaining short of our below consensus forecasts,” Goldman said.

Caught short by the demand rebound, members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, have had difficulty raising output as under-investment or maintenance delays persist from the pandemic.

“Price support came courtesy of U.S. supply tightness as disruptions in the Gulf of Mexico spurred inventory draws,” said Stephen Brennock of oil broker PVM.

The European crude benchmark was also buoyed by gains across the broader energy complex, he added.

“Surging natural gas prices fuelled rumours that it could boost demand for alternative fuels, including oil.”

India’s oil imports hit a three-month peak in August, rebounding from nearly one-year lows touched in July, as refiners in the second-biggest importer of crude stocked up in anticipation of higher demand.

(Additioanl reporting by Aaron Sheldrick; Editing by Louise Heavens and David Evans)

Brent oil nears $80 a barrel on tight supply

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Categories

Subscribe here

Read More

Recent