Severe frosts in the US have become a вЂњperfect stormвЂќ for the black gold market
Global oil prices continue to rise after reaching 13-month highs. The price of a barrel of Brent for the first time since January 2020 exceeded $65 per barrel. Thus, this week's quotes have definitely returned to the level that was last observed before the coronavirus pandemic.
According to Investing, the price of April Brent crude oil futures on the London ICE Futures exchange reached $65. As of 08:50, the price fell back to $64.89 per barrel вЂ” $0.55 (0.85%) more than at the close of the previous session.
The price of WTI futures for March in electronic trading on the New York Mercantile Exchange (NYMEX) by this time was $61.55 per barrel, which is $0.41 (0.67%) higher than the level of the previous session.
According to Bloomberg analysts, the reason for the rise in oil prices was severe frosts in the United States. They caused power outages, which in turn stopped the work of a number of large oil refineries. As a result, the volume of oil production in the United States fell by 40%, and demand did not decrease.
вЂњThe cold weather in the US is the вЂњperfect stormвЂќ for the oil market, but probably not the only catalyst for the rise in prices to the current highs. The market is also supported by the restriction of production by Saudi Arabia and the rapid reduction of energy reserves in the United States, вЂњ added Howie Lee, an economist at Oversea-Chinese Banking.