Mideast tensions push oil prices toward biggest weekly gain in months

A key Saudi Arabian oil supply hub was knocked out in an attack last weekend. (AP)
Updated 20 September 2019

Mideast tensions push oil prices toward biggest weekly gain in months

  • Saudi-led coalition launches military operation north of Yemen’s port city of Hodeidah
  • Global markets are also keeping an eye on US-China trade negotiations in Washington

SINGAPORE: Oil prices were on track to jump more than 7 percent this week, their biggest weekly rise in months, as early trading on Friday saw gains extended on fresh Middle East tensions after a key Saudi Arabian supply hub was knocked out in an attack last weekend.
A Saudi-led coalition launched a military operation north of Yemen’s port city of Hodeidah, as the United States worked with Middle East and European nations to build a coalition to deter Iranian threats after the Saudi attack.
Brent crude is on track to rise about 7.7 percent this week, the biggest weekly gain since January. The front-month November contract was at $64.75 a barrel, up 35 cents, by 0532 GMT.
US West Texas Intermediate (WTI) crude futures were up 51 cents to $58.64 a barrel, set to post a 7.1 percent gain for the week, the largest weekly rise since June.
“The forward curve remains ‘bid’ as traders are hedging that the initial estimates for the duration of repairs (at damaged Saudi facilities), given the complex nature, could well underestimate the time required,” said Stephen Innes, Asia Pacific market strategist at AxiTrader.
Saudi Arabia’s production dropped by almost half after an attack on Saturday, Sept. 14, crippled a major oil processing facility. Its oil minister has pledged to restore lost production by the end of this month, and bring capacity back to 12 million barrels per day by the end of November.
The United States and Saudi Arabia blame Iran for the assault on Saudi oil facilities. Tehran denies any involvement.
In the United States, meanwhile, torrential rain from Tropical Storm Imelda has forced a major refinery to cut production and to shut a key oil pipeline, terminals and a ship channel in Texas.
Global markets are also keeping an eye on US-China trade negotiations in Washington, as officials from both sides resumed face-to-face talks for the first time in nearly two months on Thursday.


Saudi energy minister says confident China can contain, eradicate new coronavirus

Updated 6 min 34 sec ago

Saudi energy minister says confident China can contain, eradicate new coronavirus

  • He said he was confident the Kingdom and other OPEC + producers had the capability and flexibility to respond

DUBAI: Saudi Arabia’s Energy Minister said on Monday the Kingdom was closely monitoring developments in global oil markets resulting from “gloomy expectations” over the impact of the new coronavirus on the Chinese and global economy and oil market fundamentals.


Prince Abdulaziz bin Salman said he was confident the Chinese government and international community could contain the spread of the virus and fully eradicate it.
The minister said the impact on global oil markets was “primarily driven by psychological factors and extremely negative expectations adopted by some market participants despite its very limited impact on global oil demand.”


He said he was confident the Kingdom and other OPEC + producers had the capability and flexibility to respond to any developments to maintain oil market stability if needed.

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