Oil rates see uptick amid escalating geopolitical tensions between Russia, Ukraine
Date
11/20/2024 3:28:26 AM
(MENAFN) Oil prices saw an uptick amid escalating geopolitical tensions between Russia and Ukraine, although concerns about weaker demand in China and global oil demand forecasts have somewhat capped further increases. At 9:41 a.m. local time (06:41 GMT), the international oil benchmark, brent crude, rose by 0.18 percent to USD70.98 per barrel, a slight increase from the previous session’s close of USD70.85. Similarly, the US benchmark, West Texas Intermediate (WTI), gained 0.3 percent, reaching USD66.98 per barrel, compared to its prior close of USD66.78.
The ongoing conflict between Russia and Ukraine has contributed to the rise in oil prices, with Russia launching massive airstrikes across multiple regions in Ukraine, including the capital Kyiv. These strikes, which targeted energy infrastructure, have intensified concerns about the stability of oil supplies. Russian forces employed a variety of missile types and drones, including Shaheds, Zircons, Iskanders, and Kinzhals, with Ukrainian President Volodymyr Zelenskyy reporting that over 120 missiles and 90 drones were fired overnight. Despite Ukraine's air defenses intercepting many of the projectiles, some energy facilities were damaged, and certain regions were left without power, highlighting the ongoing vulnerability of Ukraine’s energy infrastructure.
Despite these geopolitical tensions driving oil prices upward, concerns about demand, particularly in China, have limited the scope of price increases. As the world’s largest crude oil importer, any slowdown in demand from China has significant implications for global oil prices. Additionally, global oil demand forecasts have remained subdued, with the head of the International Energy Agency (IEA), Fatih Birol, stating last week that global oil demand would remain below 1 million barrels per day for the year, further dampening expectations of substantial price hikes. This combination of geopolitical instability and demand concerns has created a balancing act for oil markets.
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