The oil market has soared on the reports that two oil tankers were attacked in the Gulf of Oman. As a result, prices are on the rise driven by the fears of possible short supplies from the Middle East.
The August futures for Brent oil on London's ICE Futures platform increased to $62.38/bbl. At the same time, July futures for WTI rose on NYMEX by some 4% to $53.17/bbl.
Meanwhile in the middle of the week, quotes dropped by 3.7% and 4% respectively. The decline was related to the reports about higher reserves in the USA (2.2 million bbl up). Specifically, the data showed that oil reserves in the USA increased by 2.2 million bbl last week, as reported US Department of Energy. At the same time, market experts expected a decline of 1 million bbl.
Notably, there were reports that two oil tankers had been attacked in the Gulf of Oman.
The sources in the Port of Fujairah in the UAE stated that Front Altair tanker is in flames in the Gulf of Oman. The port received a mayday signal from the vessel. The exact location of the tanker has not been commented.
According to the media reports, the second tanker Kokuka Courageous that damaged was on the route from Saudi Arabia to Singapore.
Once the market considered that the geopolitical problems faded away in the Middle East, the new issues reappeared, which resulted in the higher risk premium and short supply concerns, as commented on the market analyst.