Daily Times

Crude oil prices went up on Thursday due to rising tensions in the Middle East as well as between Pakistan and Iran, besides relatively strong growth forecast in global oil demand this year.

As of 1245 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, gained $0.04 (+0.05 percent) to reach $77.92 a barrel. Similarly, the West Texas Intermediate (WTI), the main oil benchmark for North America, went up by $0.16 (+0.22 percent) to $72.72 a barrel.

Brent ended last week lower by 0.60 percent, falling to $78.29 a barrel from $78.76 a barrel on a week-on-week, while WTI closed last week down to $72.68 from $73.81 a barrel, registering a weekly decline of 1.53 percent. Both benchmarks shed more than 10 percent in 2023 on a year-on-year basis.

On the other hand, the price of Russian Sokol increased by $0.44 (+0.62 percent) to $71.68. Arab Light prices witnessed an increase of $0.44 (+0.56 percent) to reach $78.60 a barrel. However, the price for Opec Basket decreased to $79.16 a barrel with a dip of $0.01 (-0.01 percent).

In the latest sign of escalating geopolitical tensions, Pakistan conducted strikes inside Iran, targeting Balochi separatist militants, the Foreign Office said, two days after Iranian strikes inside Pakistan territory.

According to a statement issued by the Inter-Services Public Relations (ISPR), “hideouts used by terrorist organizations namely Balochistan Liberation Army (BLA) and Balochistan Liberation Front (BLF)” were struck in an intelligence-based operation codenamed ‘Marg Bar Sarmachar’.

Meanwhile, Iran’s IRNA news agency reported that nine people were killed in the attack targeting a village in the city of Saravan, with Iranian Interior Minister Ahmad Vahidi saying all the dead “were foreign nationals”.

On the other hand, the International Energy Agency (IEA) expects oil demand to grow by 1.24 million barrels per day (bpd) in 2024, up 180,000 bpd from its previous projection, its monthly report said. The agency cited improved economic growth and lower crude prices in the fourth quarter. The Organization of the Petroleum Producing Countries (OPEC) had said on Wednesday that it expected demand growth of 2.25 million bpd this year, unchanged from its forecast in December. The OPEC also said oil demand is expected to rise by a robust 1.85 million bpd in 2025 to 106.21 million bpd.

Oil’s range-bound trading in recent days reinforces the narrative that investors are shrugging off concern that tankers may be at risk from attacks in the Red Sea. Attacks by Yemen-based Houthi militants against ships in the Red Sea have forced many companies to divert cargo around Africa, adding to journey times and costs. The US on Wednesday conducted another round of strikes against Houthi targets in Yemen in retaliation for the attacks on shipping. The Iran-aligned Houthis say they are acting in solidarity with Palestinians during Israel’s war with Gaza.