Oil jumps as EU weighs in on Russia embargo, Saudi refinery production suffers

Philips 66’s Los Angeles refinery (front), which processes domestic and imported crude oil for storage tanks for petrol, aviation and diesel fuels and refined petroleum products at the Kinder Morgan Carson terminal (background) at sunset. , California, U.S., March 11, 2022. Image March 11, 2022. Image taken by drone. REUTERS / Bing Guan

Sign up now for unlimited free access to Reuters.com

  • The European Union is weighing in on the Russian oil embargo, and Biden is set to join the talks
  • Production of a Saudi refinery has been affected by the Yemeni Houthi attack
  • The OPEC + distribution gap widens further as February compliance increases
  • US oil spill down despite $ 100 / ppl crude price -Baker Hughes

SINGAPORE, March 21 (Reuters) – Oil prices soared above $ 111 a barrel on Monday as EU countries considered joining Russia’s oil embargo amid shocking weekend attacks on Saudi oil plants.

Brent crude was up $ 3.74 or 3.5% at $ 111.67 a barrel at 0739 GMT, up 1.2% last Friday.

US West Texas Intermediate (WTI) crude futures rose $ 3.98, or 3.8%, to $ 108.68, extending 1.7% last Friday.

Sign up now for unlimited free access to Reuters.com

Prices rose this week ahead of talks between EU governments and US President Joe Biden on a series of summits aimed at strengthening the West’s response to Moscow over the invasion of Ukraine.

EU governments will consider imposing an oil embargo on Russia. read more

Early Monday morning, Ukraine’s Deputy Prime Minister Irina Verschuk said the country’s forces were unlikely to surrender in the besieged eastern port city of Mariupol. read more

With little indication that the conflict would ease, the focus turned to whether the market could replace the Russian barrels affected by the embargo.

“The Houthi attack on the Saudi power terminal, warnings of a structural deficit in production from OPEC and the EU oil embargo on Russia have seen oil prices rise in Asia,” Geoffrey Haley, a senior analyst at OANDA, said in a statement.

“Even if the Ukraine war ends tomorrow, the world will face a structural energy shortage due to Russia’s sanctions.”

Over the weekend, the attacks by the Houthi group, which joins Iran in Yemen, caused a temporary drop in production at the Saudi Aramco refinery joint venture in Yanbu, a major supplier to Russia and a concern over the global commodity multi-commodity oil market. Decrease in year. read more

A recent report by the Organization of the Petroleum Exporting Countries and allies, including Russia, called it OPEC +, which shows that some manufacturers are still below the agreed supply quota.

OPEC + lost its production target of 1 million barrels (bpd) a day in February, three sources told Reuters under the agreement to increase production to 400,000 bpd per month by withdrawing sharp cuts made in 2020. read more

The two OPEC countries, Saudi Arabia and the United Arab Emirates, which have the potential to boost production immediately, have so far opposed calls from key consumer countries to accelerate production to help reduce oil prices.

Despite strong prices, US energy companies are also struggling to increase the number of active oil mines. read more

The International Energy Agency (IAEA) on Friday proposed ways to reduce oil consumption by 2.7 million bpd in four months, from poor supply outlooks and higher prices, to carpooling to lower speed limits and cheaper public transport. read more

The IEA estimates that this will help offset 3 million ppm of Russian crude oil and products that will be out of the market by April. read more

Sign up now for unlimited free access to Reuters.com

Sonali Paul in Melbourne and Florence Dawn report in Singapore; Editing by Sri Navaratnam and Clarence Fernandez

Our standards: Thomson Reuters Trust Principles.

Leave a Reply

Your email address will not be published.