Markets

Commodities@Moneycontrol: Crude oil prices likely to firm up further

Commodities@Moneycontrol: Crude oil prices likely to firm up further

One-time price hawk Iran this week again said it was happy with a price of about $60 per barrel, while Opec leader Saudi Arabia has been stressing its support for the existing market, partly out of fear of allowing even higher prices to encourage USA shale oil producers to boost output and grab a bigger share of world markets.

Brent crude futures were at $72.33 per barrel at 0648 GMT, up 27 cents, or 0.4 percent from their last close.

U.S. West Texas Intermediate (WTI) crude rose 2.43 per cent to $67.10 per barrel while Brent closed at $72.50, up 2.06 per cent on the day.

In China, Shanghai crude futures were also up, rising by nine yuan to 427.20 yuan a barrel, with record volumes traded on the product that was only launched in late March.

Brent crude oil futures earlier climbed to its highest level in more than three years after President Trump warned Russian Federation via Twitter to "get ready" for a US missile attack on Syria, whose government Moscow has backed during its seven-year civil war.

SINGAPORE, April 12 (Reuters) - Oil markets remained tense on Thursday on concerns over a military escalation in Syria, although prices remained some way off Wednesday's highest since late 2014 as bulging American supplies weighed.

Another damping factor was the U.S. Energy Information Administration's upward revision to its 2019 production forecast to 11.44 million barrels a day, from its previous figure of 11.27 million barrels.

Trump just tweeted that a strike on Syria is imminent
Trump cancelled a foreign trip in order to manage a crisis that is testing his vow to stand up to Syrian President Bashar Assad . US officials have consulted with global allies on a possible joint military response to Syria's alleged poison gas attack.

Oil prices jumped to their highest point in three years yesterday, amid fears of possible Western military involvement in the Syrian conflict, before edging slightly down earlier today.

A crude trader said that "There is pretty much everything offered - WTI, Eagle Ford, Mars, also Canadian [heavy crudes]...there is a decent volume available", adding he saw pressure starting to build on light sweet, Mediterranean crudes including Azerbaijan's Azeri Light, Kazakhstan's CPC Blend and Algeria's Saharan Blend.

"Oil markets are getting a bounce on increasing speculation about Trump and Syria", Streible said.

The main drivers of the increase in prices is concerns future U.S. involvement in the Middle East could disrupt supply chains, making it harder to ship overseas.

Though Syria is not a significant oil producer itself, the wider Middle East is the world's most important crude exporter and tension in the region tends to put oil markets on edge.

Commerzbank's head of commodity research Eugen Weinberg said oil market fundamentals "do not justify the current price, but unfortunately the market is focusing more on the politics and ignoring some of the warning signs, especially the hike in US oil production".