Brent oil went up 0.7% to $90.69 per barrel, while crude oil rose 0.6% $87.33 a barrel. They are headed for about 17% gains this month, the most since February 2021. According to analysts, the bullish sentiment will persist this week, as they expect OPEC+ to keep its existing policy of gradual production increases. Since August, the organization has raised its monthly output target by 400,000 barrels per day. Meanwhile, demand remains strong, hinting at an inventory decline.
The geopolitical risks appear to be even more concerning after the head of NATO declared on Sunday that Europe needs to diversify its energy supplies. Britain warned it was “highly likely” that Russia was looking to invade Ukraine. The US Secretary of State Tony Blinken stated that the country would ensure global energy supplies are not interrupted if Russia acts. So far, Russia has amassed troops on the Ukrainian border.
Moreover, the market is also cautious over the Middle East situation. The United Arab Emirates said it intercepted a ballistic missile fired by Yemen’s Houthi as the Gulf state hosted Israel’s President Isaac Herzog in a first such visit.
Sources: marketwatch.com, reuters.com