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Oil prices up 2.5% in week ending April 26

Oil prices up 2.5% in week ending April 26

 
- Renewed US sanctions on Venezuela with export capacity of around 600,000 barrels per day also fuels supply concerns
 
By By Duygu Alhan
 

ANKARA (AA) - Oil prices gained during the week ending April 26 following positive demand data from the US and escalating geopolitical tensions in the Middle East.

International benchmark Brent crude traded at $89.52 per barrel at 2.38 p.m. local time (1138 GMT) on Friday, increasing by around 2.5% relative to the closing price of $87.29 a barrel on Friday last week.

West Texas Intermediate (WTI), the American benchmark, traded at $84.12 a barrel at the same time on Friday, for a rise of about 2.3% from last Friday's session that closed at $82.22 per barrel.

According to data released by the US Energy Information Administration (EIA) on Thursday, commercial crude oil stocks in the US decreased by approximately 6.4 million barrels to 453.6 million barrels last week, signaling strong demand in the world's largest oil consumer in support of higher prices.

Meanwhile, the ongoing conflict between Israel and Palestine, despite a UN Security Council resolution demanding an immediate cease-fire in the region, continued to put pressure on oil prices.

According to local media, the Lebanese Hezbollah targeted northern Israel, killing at least one Israeli citizen in the early hours of Friday. Israel retaliated by sending a military aircraft to assault Hezbollah targets in the southern Lebanon district of Shebaa.

In solidarity with Palestinians in the Gaza Strip, Yemen Yemen’s Houthi group claimed Thursday that they carried out attacks targeting an Israeli vessel in the Red Sea and multiple sites in the southern Israeli city of Eilat.

The group's military spokesperson, Yahya Saree, said in a televised speech that their forces successfully targeted the Israeli ship MSC Darwin using missiles and unmanned aerial vehicles (UAVs) in the Gulf of Aden.

These developments in the Middle East, home to the majority of the world's oil reserves, pushed oil prices higher by fueling supply concerns.

Supplies woes were further exacerbated by US sanctions on Venezuela, which has a daily export capacity of about 600,000 barrels.

Additionally, uncertainties over when the US Federal Reserve (Fed) will start interest rate cuts continued to influence oil prices.

July saw a 45% chance of a Fed interest rate cut, down from 20% in June. The likelihood that the bank will begin reducing rates in September dropped to 59%.

A rate cut would suppress oil price gains since high interest rates increase the value of the US dollar and make oil more expensive for holders of foreign currencies.

 

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