(Bloomberg) — Oil steadied, as the restart of production at OPEC member Libya’s largest field countered concerns about tensions in the Red Sea that look set to keep disrupting shipping.
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Global benchmark Brent, which has been trading in a tight range recently, was little changed above $78 a barrel as US counterpart West Texas Intermediate topped $73. Libya’s National Oil Corp. said that flows from Sharara — which previously pumped about 270,000 barrels a day — would resume after a three-week stoppage.
In Europe, a fire that halted fuel production over the weekend at Novatek PJSC’s plant in the Baltic Sea port of Ust-Luga was linked by Ukrainian media to Kyiv’s special forces. The incident puts a spotlight back on Russian flows as Moscow’s war in Ukraine approaches the two-year mark.
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Crude has struggled for direction this year, rising and falling on alternate weeks. That see-saw pattern has developed as the impact of tensions across the Middle East, including the Israel-Hamas war in the Gaza Strip, is balanced with expectations that oil markets will remain amply supplied. Last week, the International Energy Agency highlighted gains in production outside the Organization of Petroleum Exporting Countries, with demand growth seen slowing.
“The sentiment is sourer this morning because the force majeure on Libya’s Sharara oil field has been lifted,” said Tamas Varga, an analyst at brokerage PVM Oil Associates Ltd. “Uncertainty persists and permeates the mood surrounding the global economy and markets.”
Elsewhere in the Middle East, traders are expecting prolonged disruption to shipping in the Red Sea and Suez Canal as the US attempts to prevent Iran-backed Houthi rebels in Yemen from attacking vessels. Military action to deter the assaults will take time, according to a Biden administration official, Jon Finer, who hinted Washington could take extra measures in the coming days.
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Read More:Oil Treads Water as Libyan Field Restart Counters Red Sea Risks
2024-01-22 13:49:21