Oil prices surged more than 2% on Thursday, 22 October, with Brent crude approaching $112 a barrel after a wave of new attacks on Saudi Arabia heightened fears of a widening conflict in the Middle East. The hostilities have had a clear impact on crude flows through the Strait of Hormuz, although exports have so far remained close to pre-war levels.
North Sea Brent — the European benchmark — climbed 2.23% to $111.26 a barrel in morning trading, while West Texas Intermediate (WTI) — the US benchmark — jumped 2.01% to $99.05 a barrel. European TTF natural gas, which had earlier breached €90 per megawatt-hour, was trading near €89.
A drone attack on Saudi Aramco’s Shaybah oil field killed two people but was reported not to have affected the company’s operations. A separate strike on King Fahd International Airport in Dammam claimed one further fatality, fuelling a climate of acute instability that prompted the United States to order the departure of some staff and family members from American diplomatic missions in the country.
In the Strait of Hormuz, Iranian attacks on shipping vessels have continued. The Islamic Republic has stepped up missile launches against oil tankers transiting the waterway in an apparent effort to further destabilise regional oil flows — which, despite the turbulence, are estimated to be running at around 80% of pre-war levels. The New York Times reported that the US and Israel are preparing to escalate the conflict following the upcoming American midterm elections.
“The deadly attacks continue and the risk of a new escalation after the midterm elections are providing a floor under prices,” Rebecca Babin, senior energy trader at CIBC Private Wealth Group, told Bloomberg. “The result is a market that struggles to hold onto gains, but where massive sell-offs also lack conviction,” she added.
Source: Diário Económico
Original article: https://www.diarioeconomico.co.mz/?p=554571
