Oil reaches its new 7-year peak when demand confirms Omicron | Oil and Gas Issues

West Texas Intermediate crude on February delivery, which ends Thursday, rose $ 1.53 to settle at $ 86.96 a barrel in New York.

Oil has reached its highest level since October 2014 when the International Energy Agency said the market appears to be smaller than previously thought, and demand indicates a strong omicron.

Futures in New York closed 1.8% on Wednesday, with the IEA saying in a report that the demand for oil is about to hit levels before the epidemic. The agency also said that global stocks are declining sharply as demand grows and OPEC + alliance struggles to revitalize output. This is another indication that production may be lower, or consumption may be higher, than market demands, he said.

“The market has already bought in a smaller market in 2022, and the IEA and other agencies are just doing this,” said Rebecca Babin, senior vice president at CIBC Private Wealth Management. Oil could also extend its summit because “accidents that occur in a tight market can lead to massive moves.”

Tuesday’s explosion knocked down an important pipeline from Iraq to Turkey, sending future sales of more than $ 87 a barrel.

Oil markets have tightened in recent weeks due to higher demand than expected and the demise of OPEC + manufacturers including Libya, Asian consumers are paying more for shipping costs.

In addition, concerns about the impact of the Covid-19 omicron species have diminished, global reserves are shrinking and tensions in the Middle East have returned to the radar following an oil strike in the United Arab Emirates. An impressive start to the year has made Goldman Sachs Group Inc. to boost Brent’s global forecast, predicting $ 100 oil price in the third quarter.

Prices

• West Texas Intermediate February delivery, which ends Thursday, rose $ 1.53 to settle at $ 86.96 a barrel in New York.
• The price of the contract in the coming years of March, known as rapid spread, jumped to $ 1 a barrel, the strongest since mid-November.
• Brent on March March raised 93 cents to settle at $ 88.44 a barrel

However, the oil summit poses a challenge for consumer countries and central banks as they work to curb rising prices while contributing to global growth. The White House plans to continue monitoring pricing and negotiating with the Organization of Petroleum Exporting Countries and its partners if necessary, a National Security Council spokesman said Tuesday.

• The IEA said in a report that global oil prices have plummeted in the past 12 months. Shares have fallen by more than a billion barrels since the peak of May 2020 and are very low before the epidemic, according to the report.

“All travel and necessity has gone well,” Daniel Hynes, an Australian marketing specialist with New Zealand Banking Group Ltd., told Bloomberg Television. “The display image looks very strong and this will make the markets more efficient,” he added.

Other market news:

• Royal Dutch Shell Plc is planning a major project at the Pernis refinery in the Netherlands, Europe’s largest oil refinery.
• OPEC and its allies are increasing oil production but cannot solve all the problems of the region alone, said the United Arab Emirates energy minister.
• Air travel is very low in Europe so far this month and international flights are still far from the global epidemic as countries around the world approach, or pass through, the number of diseases caused by the spread of omicrons.