Middle East Risks Keep Oil Prices High
Oil lost some of its big price rises today as the US announced the possible release of crude reserves but the possibility of military action in response to the drone attacks on Saudi oil facilities still means prices are high and that stocks are under pressure. Equity market losses have not been large but investors are continuing to support ‘safer’ assets such as gold, for which treasury prices are rising.
Brent crude prices fell 1.78% to $67.79 per barrel in Asia today (Tuesday, September 17) after a big increase yesterday of 14.6%, the biggest one-day percentage gain since at least 1988. U.S. West Texas Intermediate futures were down by 1.92% to $61.69 per barrel in Asia following yesterday’s large increase of 14.7%, the biggest one-day gain since December 2008.
The attack on the Saudi oil facilities halved the country’s oil output and created the biggest disruption to global oil supplies in absolute terms since 1979. President Trump responded by authorizing the release of emergency crude stockpiles if needed to ease some of the upward pressure on crude futures. (Source: Reuters)