SULAIMANI (ESTA) — Oil prices extend gains on Monday, with Brent crude futures surging above $70 for the first time since the coronavirus pandemic began, following reports of attacks on Saudi Arabian facilities.
Brent crude futures for May rose $1.50 to $70.86 a barrel, the highest since January 8, 2020, and were at $71.11 a barrel by 0255 GMT.
U.S. West Texas Intermediate (WTI) crude for April rose $1.38 to $67.47 per barrel. The front-month WTI price touched $68.98 a barrel earlier, the highest since October 2018.
Yemen’s Houthi forces fired drones and missiles at the heart of Saudi Arabia’s oil industry on Sunday, including a Saudi Aramco facility at Ras Tanura vital to petroleum exports, in what Riyadh called a failed assault on global energy security.
“We could see further upside in the market in the near-term, particularly as the market probably now needs to be pricing in some sort of risk premium, with these attacks picking up in frequency,” Reuters quoted ING analysts as saying in a report,
They noted that this was the second attack this month following an incident in Jeddah on March 4.
Brent and WTI prices are up for the fourth consecutive session after OPEC and its allies decided to keep production cuts largely unchanged in April.
Saudi oil minister has voiced doubts on demand recovery.
“The decision to keep quotas unchanged signals the group’s intent to drawdown inventories further, without concern of overtightening the market,” ANZ analysts said in a note, according to Reuters.
“It also suggests they see little threat from rising output elsewhere.”
