Crude oil prices in global markets faced a significant increase following an attack on a refinery in Saudi Arabia, the world's largest crude oil exporter. On Wednesday (November 6), the price of North Sea Brent crude rose to $115.90 per barrel, indicating an increase of $2.02 or 1.8%.
Increase in WTI crude oil prices
Additionally, WTI crude oil also saw an increase of $2.01 or 2.0%, trading at $101.91 per barrel. This price increase occurred following a missile attack on the largest oil refinery in Saudi Arabia on Tuesday (November 5).
Read more: Sanctioned oil tankers have turned to oil exports from the Persian Gulf
Impact of Middle East tensions on the oil market
Commodity strategists at ING Bank stated that the market is now factoring in the possibility of renewed tensions in its pricing. They added that oil prices are at a high level, and the market is awaiting more clarity regarding decisions related to Middle East tensions. If conflicts do not escalate after the U.S. elections, there is a possibility of a reduction in the risk priced into the market.
Moreover, data from the American Petroleum Institute shows that U.S. crude oil inventories decreased by 2 million and 30 thousand barrels in the week ending October 23 (Friday, November 1). Meanwhile, analysts have estimated that crude oil inventories for that week would increase by about 15 thousand barrels.
The market is also awaiting the outcome of the meeting of members of the Organization of the Petroleum Exporting Countries (OPEC) and its allies (OPEC+) on Sunday (November 10). It is expected that member producers of this coalition will not change their plans to cancel voluntary supply cuts for December. Most of the seven OPEC+ members, including Saudi Arabia, Russia, Iraq, Kuwait, Algeria, Kazakhstan, and Oman, have produced less than the set oil targets.
Finally, traders expect that Russian crude oil exports from the country's ports in the Baltic Sea and the Black Sea will decrease next month, as Russian refineries increase their diesel production under this month's agreement with Washington.
Read more: Brent oil price drops to $114.93 amid regional tensions · Crude oil prices drop following diplomatic efforts for peace in the Middle East
