Brent crude up 4%, crosses $90 a barrel on reports of Israeli missiles hitting Iran’s Isfahan
Upstox
2 min read • Updated: April 19, 2024, 8:32 AM
Summary
Brent crude futures for May delivery were trading at $90.46 a barrel, up 4.09% as against the previous day’s close. The U.S. West Texas Intermediate (WTI) crude also surged by 3.74%, and was trading at $85.82 per barrel.
The price of global crude benchmark Brent witnessed a sharp surge on Friday, April 19, after reports said that Israeli missiles have targeted Iran. The rate went up by 4%, as Brent crossed the $90 per barrel mark.
At 8:03 hours IST, Brent crude futures for May delivery were trading at $90.46 a barrel, up 4.09% as against the previous day’s close. The U.S. West Texas Intermediate (WTI) crude also surged by 3.74%, and was trading at $85.82 per barrel.
Notably, oil prices have remained under increased pressure since last week, after Iran vowed to avenge the suspected Israeli strikes on its consulate in Damascus. The attack had led to the death of seven personnel.
The Brent rate, after breaching the $90-mark at the end of last week, relatively eased as the Iranian strikes on Israeli territory, on April 13, caused only a modest damage and did not result in any fatalities. The oil market was also relieved with Tehran’s statement that it has avenged the attack on its consulate and does not want to further escalate the conflict, analysts had said.
However, the retaliatory strike by Israel today, as claimed in the latest reports, has again put the crude market under pressure.
Will Brent stay above $90/barrel?
Apart from the tensions in the Middle East, the growth and inflation dynamics in China, Europe and the United States, along with the strategy enacted by the Oil Producing and Exporting Countries and their allies (OPEC+) will also weigh-in on the crude rates in the period to come.
The rates had also climbed last week after the OPEC+ announced an extension in production cuts of up to 2.2 million barrels per day till June-end this year.
The uncertainty related to the interest rate cuts in theUS, where inflation numbers have been rising, also adds to the volatility of the crude market. According to analysts, the combination of the above factors indicates that “all the risks remain to the topside in crude oil towards $90”.
Notably, the projected oil demand for 2024 was slashed by the International Energy Agency (IEA) in the forecast released last week. The agency predicts an average consumption of 1.2 million barrels per day, down by 130,000 barrels as compared to its previous forecast.