Attack on Saudi Facilities pushes Brent past $70

oil

Following reports of attacks on Saudi Arabian facilities, Brent crude futures surged above $70 a barrel on Monday for the first time since the COVID-19 pandemic began, while U.S. crude touched its highest in more than two years.

Brent crude futures for May hit $71.38 a barrel in early Asian trade, the highest since Jan. 8, 2020, and were at $70.96 a barrel by 0611 GMT, up $1.60, or 2.3%.

U.S. West Texas Intermediate (WTI) crude for April rose $1.47, or 2.2%, to $67.56. The front-month WTI price touched $67.98 a barrel earlier, the highest since October 2018.

Asian stocks also rose after the U.S. Senate approved a $1.9 trillion stimulus bill while positive economic data from the United States and China bode well for a global economic rebound.

Yemen’s Houthi forces fired drones and missiles at the heart of Saudi Arabia’s oil industry on Sunday, including a Saudi Aramco facility at Ras Tanura vital to petroleum exports, in what Saudi Arabia called a failed assault on global energy security.

RBC Capital’s Helima Croft said the latest incident underscored just how dangerous the security environment remains in the region nearly 18 months after the September 14, 2019 Iranian strikes that temporarily took offline half of the kingdom’s oil output.

Brent and WTI prices are up for the fourth consecutive session after OPEC and its allies decided to keep production cuts largely unchanged in April.

China’s crude shipments in the first two months of 2021 are up 4.1% on year after the world’s top importer expanded its refining capacity and as its fuel demand continued to grow.

Despite fast-rising crude prices, Saudi Arabia’s oil minister has voiced doubts on demand recovery.

However, the energy minister in the world’s third-largest crude importer, India, said higher prices could threaten the consumption led-recovery in some countries.

Higher prices have also encouraged U.S. energy firms to add oil and natural gas rigs for a second week in a row, energy services firm Baker Hughes Co said on Friday.

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