The price of Brent oil is nearing $120 per barrel, creating new challenges for U.S. President Donald Trump. Although fundamental changes in the oil market are not observed, rising tensions between Saudi Arabia and the Houthis have led to price increases.
4% Increase in Oil Prices Last Week
In the past week, Brent oil prices increased by 4% and reached approximately $117 per barrel. This price increase has been influenced by escalating conflicts in the region and impactful airstrikes. Meanwhile, a decrease in transportation rates and flattening return curves have reduced price differentials in the global market.
Read more: December crude oil price reached $99.29
Decline in Oil Production in Libya
The National Oil Corporation of Libya (NOC) has announced that unauthorized activities have led to the closure of a pipeline valve serving the Hamada and Tahara fields. This action has resulted in a production decline of 50,000 and 40,000 barrels per day respectively in these two fields. Given that oil production in Libya accounts for 90% of government revenues, this situation poses a serious threat to the country's economy.
Winter Challenges in Europe and Rising Gas Prices
Meanwhile, gas prices in Europe have reached their highest level since December 2022, exceeding $30 per million BTU. A decrease in liquefied natural gas supply from Qatar and increased demand due to colder weather have severely pressured the situation.
In this context, Saudi Aramco has evacuated its employees from its headquarters in Dhahran due to Houthi attacks and has transitioned to remote work. This is the first time Aramco has taken such action since the onset of the Iran war.
Qatar's Plans for Gas Supply
QatarEnergy is working to secure long-term gas shipments from the United States and Asia. The country has successfully signed an agreement with American developer Cheniere to supply 4 million tons of liquefied natural gas per year until 2054.
Ultimately, in light of rising prices and multiple challenges, the United States is also seeking to utilize its emergency diesel reserves, which include 315,000 barrels of diesel. This action is aimed at reducing regional disruptions and in response to the decline in global diesel exports.
Read more: Brent oil price reached $114 · Brent oil price reached $114 per barrel
