Wednesday saw oil prices surge yet again after reports of declining US Crude inventories surfaced amid the rising Middle Eastern tensions.
Brent crude futures, the international benchmark for oil prices, were at $58.27 at 0131 GMT, up 39 cents, or 0.7 percent from their last close – and a third above mid-year levels.
U.S. West Texas Intermediate (WTI) crude futures were at $52.08 per barrel, up 20 cents, or 0.4 percent and almost a quarter above mid-June levels.
According to recent surveys and reports, around half a million barrels per day supply is at risk due to the ongoing geopolitical risks to the supply. IT has been long time since geopolitical risks have hindered oil supplies in the world, but the escalation of tension between US and Iran coupled with the rising instability in the Kurdish region after Iraqi forces occupied the Kirkuk refineries have changed put the geopolitical risk on the forefront.
But it’s Iraq and Iran that have really raised fears of outages. As of October 17, preliminary reports suggest that about 350,000 bpd of oil production from the Kirkuk oil fields were disrupted, with conflicting reports about whether or not that output has come back online. Iraqi officials said that the interruptions would be temporary and short-lived, and the Kurdish government insisted that it wouldn’t block exports through its pipeline system.
