Crude oil price climbed on Thursday for a third day running and bounced back to $73.28 per barrel as worries of supply disturbance amidst heightened tensions in the Middle East outshined swelling US crude inventories.
The US West Texas Intermediate (WTI) crude rose to $62.85 by 83 cents, while the global benchmark Brent, after rising by $1.51 and headlined for the biggest weekly rise in about 3 months, settled at $73.28. Brent price, however, had in the recent months hit $76 before it slumped to $70 per barrel.
Reuters reported that crude oil price was pulling support from the risk of conflict in the Middle East, with helicopters conveying US staff from the US embassy in Baghdad on Wednesday out of seeming fear over perceived threats from Iran.
Rising Tension In The Middle East.
The report also stated that Saudi Arabia’s Deputy Defence Minister, Prince Khalid bin Salman, a son of King Salman, accused Iran of directing an attack on Saudi oil pumping stations on Thursday that Yemen’s Iran-aligned Houthi militia has claimed responsibility for. Prince Khalid Bin Salman, in a tweet said that “The attack proves that these militias are merely a tool that Iran’s regime uses to implement its expansionist agenda. The terrorist acts, ordered by the regime in Tehran, and carried out by the Houthis, are tightening the noose around the ongoing political efforts.”
Tehran has denied providing arms to the Houthis. “We are not agents for anyone, we make decisions independently and do not take orders for drones or anything else.” Mohammed Ali al-Houthi told Reuters.
The Houthis, who have been battling with a Saudi-led military alliance for 4 years, said that Tuesday’s drone attacks against the East-West pipeline was carried out by the group. Though it initiated a fire, it did not disrupt oil output or exports, Riyadh told reporters.
The drone attack occurred 2 days after 4 vessels, as well as two Saudi oil tankers, were reportedly damaged by sabotage off the coastline of the United Arab Emirates.
The other vessels were a UAE-flagged bunker
barge and a Norwegian-registered oil products tanker.
The UAE is yet to blame anyone for that incident
from which Iran has distanced itself. Although,
investigations are still on going, United States
officials, however, believe Iran encouraged the Houthis or Iraq-based Shi’ite
militias to carry out the attack.
Will US Decisions Help Keep Oil Prices In Check?
Meanwhile, the United Nations’ Secretary General, Antonio Guterres, has condemned the attacks and called for “maximum restraint” by all sides. Sources reported that the attacks took place against a background of US-Iranian tension resulting from Washington’s decision to cut Tehran’s oil exports to zero this month. Saudi Arabia and the UAE support the measures against Iran – a fellow OPEC producer but regional foe.
The World’s Expectations From OPEC And Members.
Though the tensions have led to increased oil prices, a rise in US crude oil records to their peak since 2017 helped to cap prices. It is uncertain whether OPEC and other oil producers will keep prices in check or continue supply cuts that have raised oil prices by more than 30% so far this year.
Meanwhile, the oil cartel said on Tuesday that world demand for its oil would exceed expectations this year.
