SINGAPORE (ICIS)--Oil prices rose by more than $3/bbl on Monday on fresh supply worries following news of attacks on Saudi Arabia’s energy infrastructure, and amid the ongoing Russia-Ukraine war.
| 03:15 GMT | Contract | Low | High | Open | Last | Previous | Change | High Change |
| Brent | May | 107.06 | 111.3 | 107.5 | 111 | 107.93 | 3.07 | 3.37 |
| WTI | Apr | 104.08 | 108.21 | 105.13 | 107.92 | 104.7 | 3.22 | 3.51 |
Yemen’s Houthi rebels attacked multiple targets in Saudi Arabia with drones and missiles over the weekend, which included energy infrastructure, according to state-owned Saudi Press Agency.
A fuel distribution terminal in Jizan was attacked on 19 March, followed by attacks on a natural gas plant and a refinery in Yanbu on 20 March.
As a result, the 400,000 bbl/day Yanbu refinery has temporarily reduced production, but there will be no supply disruptions to customers, as inventory will be drawn down according to the Ministry of Energy.
Energy giant Saudi Aramco had said it was in the process of increasing its maximum production capacity from 12m bbl/day to 13m bbl/day by 2027.
Strong oil prices had enabled the world’s biggest crude exporter to more than double its net profit last year to Saudi riyal (SR) 412.4bn ($110bn).
Oil prices have spiked above $100/bbl on heightened supply concerns following Russia’s invasion of Ukraine in late February.
There were no signs that the conflict will ease in the near term, and the market is still waiting to see how Iranian nuclear talks will play out.
"The market is struggling to balance the impact of self-sanctioning of Russian oil and the potential demand hit we are seeing in China due to the latest Covid outbreak," Dutch banking and financial services firm ING said on Monday.
"The product markets are already tight, particularly for middle distillates. Inventories in most regions are at multi-year lows, so the market will be sensitive to any potential supply disruptions on the product side," it said.
Western nations have repeatedly called on oil cartel OPEC and its allies that include Russia (OPEC+) to raise output, to little effect.
Based on latest report from the group, showed some producers are still falling short of their agreed supply quotas.
The International Energy Agency (IEA) last week warned that up to 3m bbl/day of Russian output could fall away in April amid sanctions.
Focus article by Nurluqman Suratman
Thumbnail photo: A damaged car parked at an Aramco terminal in the southern border town of Jizan, Saudi Arabia on 20 Mar 2022 after attacks at Saudi facilities by Yemen's Houthi rebels. (Source: Saudi Press Agency/Uncredited/AP/Shutterstock)
($1 = SR3.75)
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