Oil prices rose on Thursday for a third day running as fears of supply disruption amid heightened tensions in the Middle East overshadowed swelling US crude inventories.
Brent, the international benchmark for oil prices and against which Nigeria’s crude is priced, rose by 97 cents, or 1.4 per cent, at $72.72 per barrel as at noon yesterday. Brent, is heading for its biggest weekly rise in six weeks.
Bloomberg reported that crude oil price was drawing support from the risk of conflict in the Middle East, with helicopters carrying staff from the US embassy in Baghdad on Wednesday out of apparent concern over perceived threats from Iran.
An end this month to US waivers that allowed some countries to buy Iranian oil after the reimposition of US sanctions has prompted Tehran to relax restrictions on its nuclear programme and threaten action that could breach a 2015 nuclear deal.
An attack on four oil tankers in the Gulf on Sunday, for which no one has claimed responsibility, and Saudi Arabia’s announcement that armed drones hit two of its oil pumping stations, have compounded concerns which have stoked supply-side fears.
Asian shippers and refiners have put ships heading to the Middle East on alert and are expecting a possible rise in marine insurance premiums after the attacks.
Also keeping prices in check is the uncertainty about whether OPEC and other producers will maintain into the second half of the year supply cuts that have boosted prices more than 35 per cent in 2019.