Brent nears $ 80 a barrel due to tight supply
- Brent crude nears three-year high
- WTI hits $ 75 a barrel, its highest since July
- Goldman Sachs sees Brent at $ 90 a barrel by year-end
LONDON, Sept. 27 (Reuters) – Oil prices rose for a fifth day in a row on Monday, with Brent hitting its highest level since October 2018 and heading towards $ 80 due to supply issues as demand picks up in parts of the world with the relaxation of pandemic restrictions.
Brent crude rose $ 1.43 or 1.8% to $ 79.52 a barrel at 12:27 GMT, after posting three straight weeks of gains. U.S. oil added $ 1.44, or 2%, to $ 75.42, near its highest since July, after rising for a fifth straight week last week.
Goldman Sachs raised its forecast for Brent crude by $ 10 at the end of this year to $ 90 a barrel, as the faster recovery in fuel demand after the Delta variant of the coronavirus outbreak and the blow of the Hurricane Ida on US production led to tight global supplies. Read more
“Although we have long had a bullish outlook on oil, the current global supply and demand deficit is larger than expected, with the recovery in global demand from the Delta impacting even faster than our higher forecasts. to consensus and the global supply remaining below our below consensus forecast, ”Goldman said.
Taken aback by the rebound in demand, members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC +, struggled to increase production as underinvestment or delays in maintenance persist due to the pandemic. Read more
“Price support came from tight supply in the United States, with disruptions in the Gulf of Mexico spurring lower inventories,” said Stephen Brennock of oil broker PVM.
The European crude benchmark was also supported by gains across the energy complex, he added.
“Soaring natural gas prices have fueled rumors that it could stimulate demand for alternative fuels, including petroleum.”
India’s oil imports hit a three-month high in August, rebounding from nearly one-year lows hit in July, as refiners in the second-largest crude importer stocked up in anticipation of ‘higher demand.
Additional reporting by Aaron Sheldrick; Editing by Kirsten Donovan and Louise Heavens
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