Oil Futures Achieve New Levels
Tuesday saw a substantial spike in oil futures, which ended the day at their highest level in a week as a result of rising expectations for a pickup in China’s crude consumption and worries over Middle Eastern supplies. This came after severe earthquakes in Turkey and Syria caused the Turkish Ceyhan oil export facility to cease operations.
Price Variations
On the New York Mercantile Exchange, West Texas Intermediate crude for March delivery increased by $3.03 or 4.1% to close at $77.14 per barrel. Since January 31st, this was the highest front-month contract completion. In the meantime, April Brent crude, the worldwide standard, increased by $2.70 or 3.3% to $83.69 per barrel on ICE Futures Europe.
The price of gasoline increased by 3.5% to $2.4568 per gallon in March, while the price of heating oil increased by 4.9% to $2.9044 per gallon. In addition, the price of natural gas in March increased by 5.2% to $2.584 per million BTUs.
market factors
As a result of the increasing demand for petroleum, Saudi Arabia raised the price of oil being delivered to Asia, which in turn caused the price of crude to climb. According to analysts, the reopening of the Chinese economy would raise demand for petroleum this year and push up prices.
A large export facility in Turkey that handles 1 million barrels per day was shut down as a result of the earthquake. As a result, supply-side tensions are exacerbated, which raises oil prices.
However, while the sale of Azeri crude from Azerbaijan is still halted, flows from the pipeline carrying Iraqi crude to Turkey’s Ceyhan oil export center have restarted. The performance of the US dollar, which increased by 1.3% for the month, has also had an effect on the price of petroleum. Jerome Powell, the chairman of the Federal Reserve, also expressed his predictions for “substantial decreases” in US inflation this year.
In its monthly report, which was issued on Tuesday, the Energy Information Administration increased its predictions for WTI and Brent crude oil prices in 2023 but sharply cut its predictions for US natural gas prices in 2023 and 2024. For the week ending February 3rd, analysts predict an increase in supply of 2.1 million barrels of oil, 1.6 million barrels of gasoline, and 100,000 barrels of distillates.