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Highlights
- Crude oil prices rose on Monday.
- The prices of both the benchmarks surpassed US$90 per barrel.
- Icy weather conditions in the US have created concerns related to oil supply disruptions.
Crude oil prices further rose on Monday after hitting seven-year high levels on Friday amid ongoing concerns related to supply disruptions coupled with a freezing weather condition in the US. The prices were additionally fuelled by ongoing political unrest among major oil producers.
Both the oil benchmarks rose staggeringly in the last week with Brent and WTI ending the week 3.6% and 6.3% higher respectively.
The prices rose a day earlier too following the decision of OPEC and its allies to carry forward their plan of increasing the output for the coming months.
April delivery Brent Crude oil futures last traded at US$93.81 per barrel up 1.11%, whereas March delivery WTI crude oil futures traded 0.21% up at US$92.50 per barrel as of 7 February 2022 at 12:45 PM AEDT.
The prices were also buoyed by limited supplies from the world’s leading oil producers.
Cold weather in the US
The significant rise in the prices of crude oil in the last few days is based on expectations that world oil supplies would not be enough to fulfil the rising demand.
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The recent rally in crude oil is linked to extreme cold conditions in the US bringing icy conditions, particularly in Texas, causing production to temporarily shut.
The oil market has also got support from ongoing geopolitical unrest between Russia and Ukraine. Russia has amassed thousands of troops on Ukraine's border.
Bottom Line
Crude oil prices further rose on Monday after reaching seven-year highs on Friday on the back of freezing conditions in the US, pushing oil producers to halt their operations.
