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Middle East – Boosted by concerns about potential supply disruptions following Yemen’s Houthi group’s attack on the United Arab Emirates, which escalated hostilities between the Iran-aligned group and a Saudi Arabian-led coalition, Brent crude futures rose more than 1.5 percent to more than $88 per barrel on Tuesday, the highest level since October 2014.
Oil prices have risen by more than 13 percent since the beginning of the year, fueled by fears about tightness in the oil market and investors’ willingness to overlook the possibility that the omicron variant will reduce fuel demand.
Aside from that, oil prices rose despite the fact that China and the United States recently agreed to release crude oil from their strategic stockpiles around the Lunar New Year in a move by big customers to bring energy prices down.
According to analysts, supply constraints are unlikely to alleviate as a result of underinvestment and outages in several OPEC+ member countries, which are struggling to pump at their permitted capabilities.
New geopolitical uncertainty added to ongoing indicators of tightness across the market.
Crude oil futures were up 85 cents, or 1 percent, to USD87.33 a barrel by 0525 GMT, after previously reaching a high of USD87.55, their best since Oct. 29, 2014. Brent crude futures had previously reached an all-time high of USD87.55.
The price of one barrel of West Texas Intermediate crude in the United States increased by USD1.13, or 1.4 percent, from Friday’s closing to a more than two-month high of USD84.95.
Because Monday was a federal holiday in the United States, trading volumes were light.