Oil Prices Surge on Supply Concerns

Published 09/24/2018, 10:49 AM
© Reuters.  Oil prices surged on Monday.

Investing.com - Oil prices continued to climb on Monday as an Iranian official said Saudi Arabia and Russia lack the capacity to add more oil to the market.

West Texas Crude oil futures for November rose 1.96% to $72.17 a barrel as of 10:49 AM ET (14:49 GMT). Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., increased 2.21% to an almost four-year-high of $79.97.

Iran's Organization of the Petroleum Exporting Countries (OPEC) governor, Hossein Kazempour Ardebili, told Reuters that Russia and Saudi Arabia are unable to increase production.

"They are doing little and late, to get prices higher," he said. "They got prices higher and they are going to get them higher still."

"There is no spare capacity. They cannot deliver the extra capacity that they claim."

The group of oil producers gathered in Algiers on Sunday and made no formal recommendation for any additional supply boost at its Sunday meeting. Saudi Arabia, OPEC’s largest producer, says it can add an extra 1.5 million barrels per day.

Prices of oil have been rising in recent months over concern of tightening supply due to U.S. sanctions against Tehran, which are expected to go into effect on Nov. 4. The sanctions have already caused Iran’s crude exports to fall.

Meanwhile, decreased drilling activity in the U.S. also bolstered prices, with the oil rig count falling by 1 to 866 last week.

In other energy trading, gasoline RBOB futures rose 1.47% at $2.0315 a gallon, while heating oil increased 2.05% to $2.2763 a gallon. Natural gas futures gained 1.75% to $3.026 per million British thermal units.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.