Oil prices rose due to supply disruptions in Libya, increased tensions in the Middle East, and OPEC’s statement that affirmed the organization’s commitment to price stability, which led to the return of purchasing power to the market.
Libya's Sharara oil field, the largest in the country, has begun the process of complete closure following protests. The field was pumping about 300,000 barrels per day recently.
On the other hand, the Houthi group said that it attacked another commercial ship in the Red Sea. Iran has sent a warship to the waterway, marking its boldest move to challenge US forces on the main trade route and potentially embolden the Houthis.
Adding to the tensions, Iran was hit by two explosions that killed more than 100 people. The Iranian government did not say who was responsible for the attacks.
The price of West Texas Intermediate (WTI) for February delivery rose 3.3% to settle at $72.70 a barrel in New York.
The price of Brent crude for March settlement rose 3.1% to $78.25 per barrel.
On Wednesday, OPEC issued a statement saying it was committed to “unity, full cohesion and market stability.”
Traders are assessing whether strong supplies from outside OPEC will continue to influence the oil market in 2024. High production from outside the group of producers has so far undermined its efforts to tighten supplies in the market, but the new restrictions are expected to take effect this week.
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