HOUSTON: Oil prices rose about two per cent on Monday as traders weighed the impact of wars in the Middle East and Ukraine and extreme cold weather across North America on oil supply against a bullish US stock market signalled demand growth.
Brent March crude futures rose $1.17, or 1.5pc, to $79.73 a barrel by 10:41 a.m. CST (1641 GMT).
The front-month US West Texas Intermediate crude futures contract (WTI) for February delivery was up $1.52, or 2.1pc, at $74.93 a barrel with the contract set to expire on Monday. The more active March WTI contract was up $1.20 at $74.45.
“Geopolitical factors are starting to gang up,” said Phil Flynn, analyst with the Price Futures Group, citing the Israeli war on Gaza, US attacks on Houthi rebels in Yemen, as well as the ongoing Russian invasion of Ukraine.
Severe cold weather across the US is limiting crude oil output in North Dakota, the No. 3 oil-producing state, as well reducing production operations in other states, while robust stock market activity points to stronger demand instead of a possible economic downturn, Flynn said.
Oil fundamentals could continue to drag on prices, according to IG analyst Tony Sycamore.
Published in Dawn, January 23rd, 2024
