Energy Gas Oil

Oil price likely to break the $90/bbl mark on supply disruptions, others

A combination of rising geopolitical risk and supply disruptions has pushed oil prices higher, with Brent looking increasingly likely to break the $90 mark.
According to OilPrice.Com report, energy stocks have started to outperform the wider stock market as Brent is nearing 89 per barrel this week, with energy leading the S&P 500’s eleven market sectors in March thanks to a 10% rise.
The oil markets are anticipating the OPEC monitoring meeting on April 3, looking for potential clues on the directionality of pricing, with JPMorgan already predicting Brent to be in the $90s by May on Russia’s production cuts.
The ongoing tightness in refined products has seen refiners outperforming pure upstream-focused companies by some 5 percentage points as the Red Sea shipping disruptions and refinery drone strikes in Russia kept supply restricted.
According to Reuters, OPEC production declined to 26.42 million b/d in March, down 50,000 b/d compared to February, and the oil group is expected to see lower output in April still as Iraq vowed to offset its lack of compliance.
Brent oil futures peaked at $89.08 per barrel in early Tuesday trading, signaling that the triple threat of Middle Eastern tensions, lower Mexican crude supplies, and Ukrainian drone strikes on Russian refineries could lift crude above the $90 per barrel mark. The last time that Brent settled above $90 per barrel was 27 October 2023, and with OPEC widely expected to maintain its conservative stance, it’s not that difficult to imagine Brent surging higher again.

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