Oil Price Hits Near 3-month High, Brent Trades for $76

Emmanuel Addeh in Abuja 

Oil steadied near its highest level in almost three months yesterday, after some Middle Eastern oil grades strengthened on robust demand from Asian refiners.

Brent traded near $76 a barrel after earlier Monday hitting its highest since October 14. West Texas Intermediate was around $74. Traders will be looking out for official selling prices from Saudi Arabia, the biggest exporter, after Oman and Dubai crudes jumped at the end of last year on scant supply from Iran and Russia.

Oil last week followed bullish drivers — including falling US stockpiles and increased unpredictability as Donald Trump prepares to return to the White House — to break out of a narrow range it had traded in since mid-October. 

That optimism is being pared by expectations for a glut, the possible revival of idled Organisation of Petroleum Exporting Countries (OPEC) production and lackluster demand from top importer China, Bloomberg reported.

Brent is “likely anchored around $70,” Morgan Stanley analysts, including Martijn Rats, said in a note. The bank forecasts a surplus of about 700,000 barrels a day this year, as rising supply from OPEC and producers from outside of the group outpaces demand growth.

In India, state refiners such as Bharat Petroleum Corp are buying more Middle East crude to make up for lower supply of cheaper Russian oil. Middle East crude prices could remain supported in the near term as the Joe Biden administration plans to impose more sanctions on Russia over its war on Ukraine.

Meanwhile, OPEC+, which pumps about half the world’s oil, decided early December to push back the start of oil output rises by three months until April and extended the full unwinding of cuts by a year until the end of 2026 due to weak demand and booming production outside the group.