SULAIMANI (ESTA) — Oil prices edged higher for a fourth day to a seven-year high as an outage on a pipeline from the Kurdistan Region to Turkey increased concerns about an already tight supply outlook.
Brent crude futures climbed $1.13 to $88.64 a barrel at 0631 GMT, adding to a 1.2% jump in the previous session.
The benchmark contract rose to as much as $89.05, its highest since October 13, 2014.
U.S West Texas Intermediate (WTI) crude futures jumped $1.22 to $86.65 per barrel, adding to a 1.9% gain on Tuesday. The benchmark jumped to a high of $87.08, its highest since Oct. 9, 2014.
On Tuesday, Turkey’s state pipeline operator Botas said it cut oil flows on the Kirkuk-Ceyhan pipeline after an explosion on the system.
The pipeline carries crude out of the Kurdistan Region to the Turkish port of Ceyhan for export.
The loss comes as analysts are forecasting tight oil supply in 2022, driven in part by demand holding up much better than expected against the highly contagious Omicron coronavirus variant, with some calling for a return of $100 oil, according to Reuters.
Geopolitical issues in Russia, the world’s second-largest oil producer, and the UAE, OPEC’s third-largest producer, are also adding to the supply concerns, Reuters said.
The UAE late on Tuesday called for a meeting of the United Nations Security Council to condemn an attack on Abu Dhabi on Monday by Yemen’s Houthi movement, which has threatened further attacks.
Meanwhile, Russian troops are lined up on the border of Ukraine, with the White House calling the crisis extremely dangerous and saying Russia could invade at any point.
“OPEC+ is falling short of hitting their production quotas and if geopolitical tensions continue to heat up, Brent crude might not need much of a push to get to $100 a barrel,” Reuters quoted OANDA analyst Edward Moya as saying.
