Global benchmark Brent crude rose to $95 a barrel, extending strong gains driven by supply curbs from OPEC+ leaders.
The gains in recent sessions have been accompanied by jumps in key time spreads, suggesting the market is undersupplied and bullish call options have become more expensive. In physical markets, refined products such as diesel are increasingly raising warning signs, with refineries around the world proving unable to produce enough industrial fuels. The price is much higher than the price of crude oil.
Meanwhile, at the World Petroleum Congress in Calgary, Saudi Energy Minister Abdulaziz bin Salman Al Saud said energy markets needed regulation and that the OPEC+ alliance was targeting volatility, not price.
Will oil hit $100?it’s already on some markets
Nigerian crude Qua Iboe topped $100 a barrel on Monday, Malaysian crude Tapis hit $101.30; Brent oil futures traded as high as $94.89
Oil prices are up about 10% this year due to OPEC+ restrictions. U.S. crude inventories fell as speculators raised net bullish bets on Brent and U.S. benchmark West Texas Intermediate crude to fresh 15-month highs. The outlook for global demand is also brightening, with the U.S. likely to avoid a recession and Chinese refiners firing on all cylinders. But Prince Abdulaziz warned on Monday that the outlook for Chinese demand remained uncertain.
As central bankers try to decide whether to continue raising interest rates, soaring oil prices look set to add to global inflationary pressures. This week will be an important one for monetary policy, with decisions from the likes of the Federal Reserve and Bank of England.
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