NEW YORK: Oil prices inched up Tuesday, as traders weighed production outages in the US and tensions in the Middle East and Europe against rising crude supply in Libya and Norway. Brent crude futures were up 30 cents, or 0.4%, to $80.36 a barrel at 11:24 a.m. EST (1618 GMT).
US West Texas Intermediate crude futures (WTI) gained 46 cents, or 0.6%, to $75.22 a barrel. In the Middle East, tensions rose the morning after US and British forces carried out a second joint round of strikes on Houthi positions in Yemen.
“Traders weigh up economic prospects, interest rates, OPEC+ and the risk of supply disruptions as a result of events in the Red Sea,” OANDA analyst Craig Erlam said. “We’re no clearer on any of these than we were a few weeks ago.”
Supply constraints in the US also boosted prices. More than 20% of North Dakota’s oil output remained shut in due to cold weather and operational challenges, the state’s pipeline authority said. Weather-induced shutdowns could deplete crude inventories reported on Tuesday by the American Petroleum Institute (API), PVM analyst John Evans said.
A Reuters poll forecast US crude inventories would fall by about 3 million barrels in the week to Jan. 19. On Monday, crude prices rose by around 2% after a Ukrainian drone struck Novatek’s Ust-Luga Baltic fuel export terminal near Russia’s second city St Petersburg.
It was a “timely reminder that a bigger, more influential war is still raging on,” Evans said.
Still, rising production elsewhere limited price gains.
“You’ve got the geopolitical pressures that aren’t enough to really rally the oil market, but they’re enough to keep the market from bottoming out of the range,” said Bob Yawger, director of energy futures at Mizuho Bank.
Norway’s crude production rose to 1.85 million barrels per day (bpd) in December, up from 1.81 million bpd the previous month and beating analysts’ forecasts of 1.81 million bpd, according to the Norwegian Offshore Directorate (NOD).
In Libya, production at the 300,000 bpd Sharara oilfield restarted on Jan. 21 after the end of protests that had halted output since early this month