Oil may rise to hit $75 per barrel on Middle East tensions - The National

Oil may rise to hit $75 per barrel on Middle East tensions - The National:

The oil price could rise to the $75 per barrel mark because of escalating tensions between the US and Iran, but the hike is unlikely to sustain long term owing to ample spare supply capacity of Opec and non-Opec oil producers as well as weak global demand for crude.

Oil prices rose more than 4 per cent on Friday, in a knee-jerk reaction to the killing of Qassem Suleimani, the head of Iran’s Revolutionary Guard’s foreign operations branch, the Quds Force, in a US rocket strike at Baghdad International Airport. 


Brent, the benchmark for more than half of the world's oil, ended the trading session at $68.60 per barrel up 3.56 per cent, with West Texas Intermediate closing at $63.05 per barrel, up 3.06 per cent.

“Any larger sustained disruption to supply could send prices toward $75 per barrel or higher. But adequate-to-ample crude spare capacity, in addition to strategic oil reserves held by OECD [Organisation for Economic Cooperation and Development] countries, provide a key supply cushion,” Giovanni Staunovo, a commodity analyst at the Zurich-based, UBS said in a report.