AVN 64.80 Increased By ▲ 0.63 (0.98%)
BAFL 30.90 Increased By ▲ 1.00 (3.34%)
BOP 4.73 Increased By ▲ 0.10 (2.16%)
CNERGY 3.87 Decreased By ▼ -0.02 (-0.51%)
DFML 13.44 Increased By ▲ 0.09 (0.67%)
DGKC 41.34 Increased By ▲ 0.49 (1.2%)
EPCL 46.23 Decreased By ▼ -0.77 (-1.64%)
FCCL 11.39 Increased By ▲ 0.39 (3.55%)
FFL 5.05 Decreased By ▼ -0.03 (-0.59%)
FLYNG 5.81 Increased By ▲ 0.04 (0.69%)
GGL 9.90 Increased By ▲ 0.15 (1.54%)
HUBC 64.06 Increased By ▲ 2.11 (3.41%)
HUMNL 5.67 Increased By ▲ 0.02 (0.35%)
KAPCO 27.83 Increased By ▲ 0.25 (0.91%)
KEL 2.13 Decreased By ▼ -0.02 (-0.93%)
LOTCHEM 24.35 Increased By ▲ 0.05 (0.21%)
MLCF 21.36 Increased By ▲ 0.64 (3.09%)
NETSOL 84.43 Increased By ▲ 1.33 (1.6%)
OGDC 87.80 Increased By ▲ 1.75 (2.03%)
PAEL 10.92 Increased By ▲ 0.12 (1.11%)
PIBTL 4.17 Increased By ▲ 0.03 (0.72%)
PPL 77.53 Increased By ▲ 1.34 (1.76%)
PRL 13.65 Decreased By ▼ -0.01 (-0.07%)
SILK 0.88 Decreased By ▼ -0.01 (-1.12%)
SNGP 41.75 Increased By ▲ 1.00 (2.45%)
TELE 5.89 Increased By ▲ 0.01 (0.17%)
TPLP 15.81 Increased By ▲ 0.16 (1.02%)
TRG 112.65 Increased By ▲ 2.55 (2.32%)
UNITY 13.97 Increased By ▲ 0.22 (1.6%)
WTL 1.14 Decreased By ▼ -0.01 (-0.87%)
BR100 4,048 Increased By 80.6 (2.03%)
BR30 14,467 Increased By 282.1 (1.99%)
KSE100 40,673 Increased By 801.8 (2.01%)
KSE30 15,190 Increased By 292.7 (1.96%)
Markets

Oil extends rally on Texas supply disruptions

  • Texas cold deep freeze shut down oil wells and refineries.
  • OPEC+ likely to ease curbs on supply after April – sources.
Published February 17, 2021
Follow us

LONDON: Oil prices rose on Wednesday, underpinned by a major supply disruption in the southern United States this week where a winter storm hit Texas.

Benchmark Brent crude gained 91 cents, or 1.4%, to $64.26 a barrel at 1209 GMT, its highest level since January 2020.

US West Texas Intermediate (WTI) crude rose 68 cents, or 1.1%, to $60.73 a barrel.

"WTI clocked in at $60 a barrel this week, joining its transatlantic peer (Brent) above the psychological level for the first time since January 2020. At this price point, any oil production is profitable," said Stephen Brennock of broker PVM.

Oil has been supported in recent weeks by OPEC+ supply curbs and hopes a demand rebound due to COVID-19 vaccinations, but severe cold weather in Texas, the country's largest oil producing state, has boosted the prices in recent days.

The US deep freeze is expected to disrupt production for several days if not weeks, industry experts, as wellheads have frozen and refineries have been shut.

ANZ and Citigroup analysts estimated at least 2 million barrels per day (bpd) of US shale oil production had been curtailed. Citi estimated a cumulative production loss of around 16 million barrels through early March.

The stronger price environment has put more attention on OPEC+, which groups OPEC, Russia and allied producers. It meets to set policy on March 4.

"The impact on crude oil prices will largely depend on how long the power crisis will last, but eventually prices will likely return to the fundamentals with a focus on the global energy demand and OPEC+," said Margaret Yang, a strategist at Singapore-based DailyFX.

OPEC+ oil producers are likely to ease curbs on supply after April given a recovery in prices, OPEC+ sources told Reuters.

"We believe that OPEC+ will likely take a more conservative approach, and ease output more modestly," said ING analyst Warren Patterson.

US oil inventory data from the American Petroleum Institute and the US Energy Information Administration (EIA) will be released on Wednesday and Thursday respectively, a one day delay for each after this week's US holiday.

Analysts polled by Reuters estimated, on average, that crude stocks fell 2.2 million barrels in the week to Feb. 12.

Comments

Comments are closed.

Oil extends rally on Texas supply disruptions

Dar meets IMF review mission, apprises it of planned power sector reforms

After 29 successive losses, rupee sees some gain, settles at 267.89 against US dollar

US Fed starts policy meeting with smaller rate hike likely

We must put our house in order, says Asif after Peshawar mosque bombing

Corps commanders resolve to bring perpetrators of Peshawar attack to ‘exemplary justice’

Inflationary pressure expected to calm down gradually: Finance Division

KSE-100 jumps 800 points owing to optimism over IMF talks

Pakistan’s performance worsens, rank remains same in corruption perception index

Barrick Gold makes first payment of $3mn to Balochistan govt

India’s Adani says to keep investing in Israel after Haifa port takeover