Global oil prices surged sharply on Thursday as markets remained worried about supply disruptions linked to the ongoing tensions in the Middle East
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MUMBAI — Global oil prices surged sharply on Thursday as markets remained worried about supply disruptions linked to the ongoing tensions in the Middle East.
The rally in crude prices came despite the announcement of the largest coordinated release of emergency oil reserves by the International Energy Agency.
Benchmark crude prices climbed more than 8 per cent during the day. West Texas Intermediate rose around 8.8 per cent to trade near $95 per barrel, while Brent crude gained about 8.9 per cent to hover around $100 per barrel.
The surge reflected strong concerns among traders that global supply could tighten if the conflict in the Middle East disrupts oil shipments.
On Wednesday, the International Energy Agency announced that its 32 member countries would release a combined 400 million barrels of crude oil from their strategic reserves.
The move marks the largest coordinated drawdown of emergency oil stocks since the agency was formed after the 1973 Oil Crisis.
Separately, the United States Department of Energy said it would release 172 million barrels of oil from the country’s Strategic Petroleum Reserve.
US Energy Secretary Chris Wright said the shipments could start as early as next week and may take about 120 days to complete.
However, despite these coordinated efforts to increase supply, oil markets continued to rise. Traders remain concerned that the emergency releases may not be enough to fully offset potential disruptions in oil flows through the Strait of Hormuz, one of the world’s most critical routes for global crude shipments.
Meanwhile, Indian equity markets opened sharply lower as surging crude oil prices weigh on sentiment.
Asian shares also fell as reports of additional vessel strikes in the Strait of Hormuz and Iraqi waters sent oil prices higher, fanning inflation fears and pushing borrowing costs up globally.