Global crude oil prices rise up to 5.27pc for fourth week

ISLAMABAD: Global crude oil prices rose up to 5.27 percent for the fourth straight week, climbing to a nine-week high.

The global oil prices were lifted by tight supply, easing concerns over the spread of the Omicron coronavirus variant, and a weaker US dollar. In the previous three weeks, the global crude oil prices surged up to 8.85 percent, 2.15 percent and 4.13 percent, respectively.

According to details, the US West Texas Intermediate (WTI) reached $83.82 from $78.90, up by 4.97 percent during the week. The lowest closing for the week, $78.23, remained on Monday while the highest closing for the week was on Friday at $83.82.

Similarly, Brent, the international benchmark for two-thirds of the world’s oil, increased 5.27 percent during the week to reach $86.06 from $81.75 a barrel. The lowest closing for the week was $80.87 on Monday while the highest closing was observed on Friday at $86.06.

The price for Opec Basket surged 4.85 percent from $80.80 to $84.72 a barrel, Arab Light price increased 2.39 percent to reach $84.24 from $82.27 and the price of Russian Sokol jumped 3.75 percent to $86.49 from $83.36 a barrel during the last week.

The US dollar headed for its largest weekly fall in eight months, turning commodities into a more affordable purchase for holders of other currencies. The US dollar index was 0.1 percent higher at 94.931, but finished the week down by about 0.9 percent, representing its worst weekly showing in eight months.

In addition to the weak dollar, oil markets have also been taking comfort from a boost in demand optimism, as early signs that Omicron cases are levelling off in US cities where the new variant first emerged suggest the US is approaching its infection peak.

Global crude prices have also been affected by the weekly report by the US Energy Information Administration showing that US commercial crude oil stocks declined by 4.55 million barrels to 413.3 million barrels in the week to January 7.

Supply constraints and worries of a Russian attack on neighbouring Ukraine also pushed prices towards their fourth weekly gain despite reports that China is set to release crude reserves around the Lunar New Year – starting February 01 – as it joins the US-led plan to drive down global oil prices.

The exact volume to be released has not yet been disclosed, and will reportedly be dependent on oil price levels. The Biden administration conducted a series of talks in November last year with Japan, India, South Korea, and the UK, all major oil consumers, to launch a coordinated release of oil stockpiles, intended to help drive down rising prices as restricted supplies put a squeeze on the market.

While China typically keeps its oil reserves under wraps, in September last year the nation had its first ever public crude oil reserves auction, selling off 7.4 million barrels. Japan and South Korea have also announced their plans for crude sales this year.