World News
Oil Breaks $80 As Hezbollah Strikes Haifa
Oil enjoyed another round of robust gains on Monday, driven by persistent fears that the Israel/Iran conflict will intensify and possibly involve other Middle East players, potentially disrupting supply.
Brent settled up $2.88 at $80.93 per barrel, while West Texas Intermediate settled up $2.7 at $77.14 per barrel.
Iran-backed Hezbollah fired rockets into Haifa, Israel's third largest city on Monday, while Israel held steadfast to its vow to expand ground incursions into southern Lebanon.
Tudor, Pickering, Holt & Co analysts joined the chorus of experts who worried that the hostilities could have consequences for energy consumers globally.
They wrote, "There is growing concern that [the] conflict may continue to escalate - not only putting Iran's 3.4 mmbopd [million barrels of oil per day] of production at risk - but creating further disruptions to regional supply."
Andrew Lipow, president of Lipow Oil Associates, warned that if Tehran's oil infrastructure is wrecked, prices could rise by another $3 to $5 per barrel.
For their part, Goldman Sachs Group Inc. analysts including Daan Struyven predicted in a note that Brent could surge to the $90s if Iran's oil supply is disrupted.
The bank also noted that algorithm-driven traders could unleash as much as $40 billion of buying in Brent and WTI combined if prices rise significantly – funds of which, along with other speculators, "had amassed a record bearish stance before the latest tensions surfaced and have been quickly unwinding those bets over the past week," according to Bloomberg.
Yet another analytical voice regarding possible outcomes of the Middle East tensions was Alan Gelder, vice president of oil markets at Wood Mackenzie; he told media that the worst case scenario would be a disruption in the Strait of Hormuz, through which 20 percent of the world's crude exports flow.
Gelder said Iran might target the strait in response to an Israeli strike, which would have a far more dramatic effect on crude prices.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 610.00 | 7.50 | 690.00 | 14.00 |
| Rotterdam | 545.00 | 4.50 | 678.50 | 13.00 |
| Houston | 554.00 | 1.50 | 687.50 | 2.00 |
| Fujairah | 596.50 | 4.00 | 782.50 | 0.50 |
| Global 20 Ports Average | 616.00 | 1.00 | 763.50 | 6.50 |
| Global 4 Ports Average | 576.50 | 4.50 | 709.50 | 7.00 |
| Global Average Bunker Price | 657.00 | 4.00 | 831.50 | 7.00 |
Popular Now More
-
Oct 08Analysts continue to debate outcomes, worst-case scenarios -
Oct 082022's iteration involved more than 1,800 participants from more than 60 countries. -
Oct 07Based on a rough straw poll of its larger customers, World Fuel estimates about half of them are using additives in their fuel at least some of the time, the company tells Ship & Bunker.