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Tuesday, October 4, 2022
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HomeBusinessOil edges toward $100 per barrel

Oil edges toward $100 per barrel

Oil prices continue to move toward the $100 a barrel threshold amid growing supply concerns, as OPEC and allied producers are slow to boost output.

Ransomware attacks on German storage facilities and winter storms in the US are also pushing prices higher.

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Foreign media reported that European benchmark Brent Crude closed around $92.8 per barrel on February 4, its highest level in more than seven years, surging 1.8 percent. European oil majors Shell and BP also rallied on Brent gains, jumping three percent. Shell earlier reported that its annual profits quadrupled in 2021. The Brent rally followed ransomware attacks on two German fuel storage facilities, Mabanaft and Oiltanking, earlier this week. A number of other storage sites across Europe also reported IT issues, but those have not been confirmed as related to the attacks in Germany.

Meanwhile, US benchmark West Texas Intermediate (WTI) also hit its peak since 2014, jumping nearly 2% and topping $91.9 a barrel. Experts link the gains to the winter storm that enveloped central and northeast regions of the US on Thursday and partly stalled oil production in the Permian Basin, the US’ largest shale site. Both benchmarks on Friday were on course for a seventh consecutive weekly gain. Oil has been on the rise recently amid supply concerns and growing tensions between Russia and Ukraine, which could threaten Europe’s energy supply. Also, investors have not been happy with cautious steps to boost oil output taken by the Organization of the Petroleum Exporting Countries and allies (OPEC+), including Russia. The group last year agreed to gradually raise production by 400,000 barrels, and said earlier this week that it would stick to this plan in March. However, many OPEC+ producers are struggling to meet the target output increase. For instance, OPEC’s second-largest oil producer Iraq failed to make its OPEC+ quota in January, according to data from state-owned marketer SOMO. Many analysts warned last year that amid the mounting troubles oil may reach $100 and more per barrel in the year to come.

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