Crude Oil Prices Heat After Soaring 1.4% Over the Week

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Crude Oil Prices Heat After Soaring 1.4% Over the Week


Crude oil prices rose more than 1% and broke above US$ 120 per barrel at the weekend. Investors are again calculating the impact of a missile attack on oil distribution facilities in Saudi Arabia with the possible release of oil reserves by the United States.

Friday (25/3), the price of Brent crude oil for delivery in May 2022 closed up US$ 1.62 or 1.4% to US$ 120.65 per barrel.

Similarly, the price of West Texas Intermediate (WTI) crude oil for May 2022 delivery also closed up US$1.56 or 1.4% to US$113.90.


Both benchmark oil prices posted their first weekly gains in three weeks. In which, Brent rose 11.5% and WTI rose 8.8% on the week.

The sentiment for oil prices came after Yemen's Houthis said they had launched an attack on Saudi Arabia's energy facilities on Friday (25/3). At the same time, the Saudi-led coalition said Aramco's fuel distribution station in Jeddah had been targeted, but that fire on two tanks at the facility had been brought under control.

Saudi Arabia insists it will not be responsible for the shortage of oil supply in the global market caused by the Yemeni Houthi attack on its oil facilities.

The Iran-aligned Houthi movement has been battling the Saudi-led coalition for the past seven years by launching missiles at Aramco's facilities in Jeddah and drones at the Ras Tanura and Rabigh refineries, the group's military spokesman said.


"The market, already avoiding Russian oil supplies, has something else to worry about with a Houthi attack potentially impacting Saudi Arabian production," said Andrew Lipow, president of Lipow Oil Associates in Houston. It is noted that attacks by the Houthi rebels are becoming more frequent.

The attack came just five days after the Houthi rebel group fired missiles and drones at Saudi Arabia's energy and water desalination facilities. This causes a temporary decrease in production at the refinery.

With global stockpiles at their lowest since 2014, analysts said the market remained vulnerable to supply shocks.

What's more, President Joe Biden's administration is considering releasing another oil from the Strategic Petroleum Reserve that, if done, could be greater than the 30 million barrel sale earlier this month, a source said.

The number of US oil rigs, an early indicator of future production, rose by seven to 531 this week, the highest since April 2020, as the government urged producers to increase output after Russia's invasion of Ukraine.

Although the number of oil rigs has risen for the 19th month in a row, the gains have been small and slowed recently as many companies focus on getting money back to investors rather than increasing output and facing supply constraints.


Oil prices slipped earlier in the session as exports from Kazakhstan's CPC crude terminal partially resumed and the European Union refrained from imposing an embargo on Russian energy as members remained divided on the issue.


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