Oil prices soared to a two-month high on Monday amid a tight market for refined fuel and issues concerning supplies from Russia.
- The international benchmark Brent crude jumped to $120.50 a barrel in early trading, reflecting a 1% increase before the expiration of July contracts on Tuesday. This is the highest in two months.
- A similar movement was seen in the benchmark West Texas Intermediate, which climbed to $116 a barrel, while Brent contracts for delivery in August were 0.5% higher at $116.20 a barrel.
- The movements come amid the increase in diesel and gasoline prices, on the back of the tightening of supply in major delivery hubs, and lower exports from Russia amid its invasion of Ukraine.
- The Organization of the Petroleum Exporting Countries and its allies are set to meet on Thursday, widely anticipated to maintain a monthly output increase of 400,000 barrels.
Consultants believe that political decisions such as subsidies continue to distort the market.
OIL is down 4.88%, while USO is down 0.36% premarket.
Source: Financial Times