Workers walk while oil pumps are seen in the background at the Uzen oil and gas field in the Mangistau region of Kazakhstan, November 13, 2021. REUTERS/Pavel Mikheyev
- Iran blames the US for halting Vienna nuclear talks
- The IEA agrees to release more oil
- Yemen’s warring factions break through to a two-month ceasefire
LONDON, April 4 – Oil prices surged above $105 a barrel on Monday as concerns over supply shortages amid Russia’s invasion of Ukraine and the lack of an Iranian nuclear deal continued, even as countries released oil from strategic reserves.
February’s invasion of Ukraine sharply increased supply concerns already supporting oil prices. Sanctions imposed on Russia and avoidance of Russian oil buyers have raised fears of major supply losses as of this month.
Brent crude was up 63 cents, or 0.6%, to $105.02 a barrel by 0805 GMT. US West Texas Intermediate Crude was up $1.08, or 1.1%, to $100.35. Both contracts slipped $1 as markets opened on Monday.
“Will the release of barrels from strategic reserves fill a deficit caused by sanctions and buyers’ dislike of Russian oil? In a word, no,” said Stephen Brennock of oil brokerage PVM.
Brent fell about 13% last week after US President Joe Biden announced a record release of US oil reserves and members of the International Energy Agency pledged to tap more reserves. Crude oil hit $139 last month, its highest level since 2008. Read more
“This short-term move to target lower oil prices…does not solve the long-term problem,” said Avatrade’s Naeem Aslam.
Oil also received support from a lull in talks to revive the Iran nuclear deal that would allow sanctions on Iranian oil to be lifted. Iran on Monday blamed the United States for the stop. Continue reading
Some downward pressure on prices came from a ceasefire in Yemen, which could ease threats to Middle East supply.
The United Nations has brokered a two-month ceasefire between a Saudi-led coalition and the Houthi group, allied with Iran for the first time in the seven-year conflict.
Saudi oil facilities were attacked by the Houthis during the conflict, which helped disrupt supplies from Russia. Continue reading
Reporting by Alex Lawler Additional reporting by Florence Tan and Isabel Kua in Singapore Editing by David Goodman