[New York 15th Reuters]-Crude oil prices rose by more than 15% on the night of New York time 15th (Asia time 16am), the highest price in about 4 months. Two oil facilities of state oil company Saudi Aramco in eastern Saudi Arabia were attacked on the 14th.
North Sea Brent Futures <LCOc1> is 19% over 1 barrel = $ 71.95. US WTI Crude Oil Futures <CLc1> is more than 15% higher at $ 63.34. Both were high since May.
As of 2250 GMT (Japan time 16th, 7:50 am), it is about 12% higher. After the attack on the Saudi oil facility, US President Trump revealed on the 15th that it had approved the release of US strategic oil reserves as needed.
Aramco said that the attack would reduce Saudi oil production by 5.7 million barrels a day. This is equivalent to more than 5% of the world oil supply. [nL3N266001]
Michael Tran, Managing Director of Energy Strategy at RBC Capital Markets, said that “the rapid rise in crude oil prices is a natural reflex reaction” and how far the supply hindrance will be able to maintain the outlook and rising levels. He pointed out that it will depend on whether it will continue or whether it will achieve its commitment to export.
“Even if it normalizes early, the possibility of losing nearly 6% of the world's oil supply is no longer a hypothesis. The risk premium has returned,” he said.
