Xinhua News Agency, New York, February 4th. Summary: Supply risks drive international oil prices significantly higher
Xinhua News Agency reporter Liu Yanan
As the market is worried about the risk of crude oil supply, international crude oil futures prices have risen continuously recently. After breaking through the integer mark of $90 per barrel on the 3rd, they rose again on the 4th.
As of the close on the 4th, light sweet crude oil futures for March delivery on the New York Mercantile Exchange rose $2.04 to close at $92.31 a barrel, or 2.26%. Brent crude futures for April delivery rose $2.16, or 2.37%, to settle at $93.27 a barrel in London.
Market analysts believe that factors such as extreme weather, production bottlenecks in oil-producing countries and geopolitical tensions have brought greater uncertainty to crude oil supply, driving oil prices to continue to rise.
About 350,000 residents and commercial businesses were out of power in Tennessee, Arkansas and Texas and other places on the 3rd due to freezing rain and snow brought by winter storms, and more snowfall is expected to hit the eastern United States on the 4th.
Carsten Fritsch, commodities analyst at Commerzbank, said the sudden cold weather in Texas has triggered a new round of oil prices, and the market is worried about the large-scale production interruption in the largest shale oil producer in the United States like early last year.
In addition, data from Iraq’s National Petroleum Marketing Agency showed that Iraqi crude oil production in January was well below the quotas agreed by major producers.
Manish Raj, chief financial officer of Wilandra Energy, said that crude oil inventories in OECD countries are at multi-year lows, and the market relies on oil-producing countries to gradually increase supply, but overestimates the ability of these countries to increase production . The Organization of the Petroleum Exporting Countries (OPEC) failed to produce crude oil according to its quotas, exacerbating the crude oil supply and demand gap.
Prices still have room to rise due to tensions between Russia and Ukraine, also making traders nervous, said Phil Flynn, an analyst at Price Futures Group in the United States.
UBS said the actual increase will be lower than the quota as major producers face bottlenecks in increasing output.
Looking ahead to the trend of oil prices, Commerzbank raised its oil price forecast for the first quarter of 2022 to $90 per barrel from the previous $80 per barrel, while UBS raised its forecast for Brent crude futures in the next few quarters from the previous forecast of $85 per barrel. The dollar was raised to $90 to $100 a barrel.