| 26 February 2024, Monday |

Oil Edges Lower Amid Middle East Fighting, But Shipping Companies Return to Red Sea

Oil prices were edging lower, with trading muted through the festive period.

Brent crude was down 0.2% to $80.71 a barrel while WTI was down 0.3% to $75.31 a barrel.

Major shipping firms including Maersk and MSC are returning to shipping routes through the Red Sea, despite the ongoing fighting in the Middle East.

Prices climbed on Tuesday over worries that exports through the region would be constrained by the hostilities.

France’s CMA CGM also said it was resuming passage through the Red Sea after deployment of a multinational task force to the region.

“I think we have to wait and see whether the increased naval patrols and rerouting of ships lead to a decline in attacks,” said Callum Macpherson, head of commodities at Investec, Reuters reported.

Both the Brent and WTI benchmarks settled more than 2% higher in the previous session as the latest attacks on ships in the Red Sea prompted fears of shipping disruption.

The prospect of a prolonged Israeli military campaign in Gaza remained a major driver of market sentiment.

Israeli forces pummelled central Gaza by land, sea and air on Wednesday, a day after Israel’s Chief of Staff Herzi Halevi told reporters the war would go on “for many months”.

Elsewhere, oil loadings at the Russian Black Sea port of Novorossiisk were suspended because of a storm. However, the Caspian Pipeline Consortium (CPC) terminal near the port was open, Kazakhstan’s energy ministry said.

US crude oil inventories rose last week by 1.84 million barrels, according to market sources citing American Petroleum Institute figures on Wednesday.

  • Asharq Al-Awsat