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The benchmark U.S. oil price topped $ 60 a barrel early Monday, the highest price since January last year, as a winter arctic explosion swept through Texas, raising concerns over disruption potential shale production in the premier oil-producing state and logistics on the US Gulf Coast.
As of 9:26 a.m. ET on Monday, the price of West Texas Intermediate Crude had risen 1.38% to $ 60.26. Brent Brent prices also rose and topped $ 63 a barrel to $ 63.11, up 1.12% on the day.
Winter storms in Texas have raised concerns over shale supply disruptions, analysts said.
On Monday, the price of oil “resumed its tightening of supply, now with the additional boost of an Arctic explosion in the United States reaching as far as Texas to potentially disrupt Permian flows, the most large plot of American shale, ”Saxo Bank analysts said early Monday.
WTI prices have now risen 16% in February alone, after both benchmarks last week ended their longest streak of consecutive daily gains in two years.
The rally resumed on Friday and continued on Monday as expectations of a further drop in global stocks and hopes that the United States would adopt the stimulus package again are still expected.
In recent weeks, oil prices have also been supported by an increase in immunization rates as well as falling COVID-19 cases and hospitalizations in the world’s largest economy, the United States.
Current price levels, if held until early March, could push some OPEC + producers to demand a more aggressive easing of cuts when the group meets to discuss oil production at from April 1, ING strategists Warren Patterson and Wenyu Yao said on Monday.
“At current price levels, one would expect a number of producers to push for further easing, and this is the position we expect to see Russia taken,” the strategists said, adding that “However, OPEC + will be keen to avoid a repeat of last year’s March meeting, when the previous deal collapsed.
By Tsvetana Paraskova for OilUSD
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