Oil prices remain stable after a rise of more than 2% in the previous day. The main reason was the combination of U.S. production outages and the partial restart of operations in Kazakhstan. operations in Kazakhstanwhich has generated a momentary balance in the global crude oil supply.
Brent was trading at $65.81 per barrel, while U.S. WTI was down slightly at $60.94, according to midday data in London on Monday. Both indices had closed the previous week with a 2.7% advance, reaching levels not seen since mid-January.
U.S. suffers from winter storm downturns
On the U.S. side, Winter Storm Fern hit oil and natural gas producing regions hard, forcing multiple operations to shut down and affecting the power grid. According to JPMorgan estimates, daily production fell by approximately 250,000 barrels, affecting areas such as the Bakken, Oklahoma and parts of Texas.
This situation generated upward pressure on prices, especially due to the increased demand for heating oil, typical of these extreme weather conditions.
Kazakhstan recovers capacity, but with limitations
On the other side of the world, Kazakhstan’s Ministry of Energy announced that its largest oilfield is in the process of resuming operations. Although the Black Sea terminal operated by the Caspian Pipeline Consortium (CPC) has now returned to full loading capacity after maintenance, exports from CPC Blend are still limited due to force majeure.
This means that, although there are signs of improvement, the flow of oil is oil flow from this region has not yet returned to normal levels, keeping the market cautious. from this region has not yet returned to normal levels, which keeps the market cautious.
U.S.-Iran tension also influences the market
Oil prices are also being influenced by geopolitical risks. U.S. President Donald Trump’s statements, warning Iran of military consequences should it restart its nuclear program or crack down on demonstrations, have raised risk perceptions among investors.
The deployment of the aircraft carrier USS Abraham Lincoln to the Middle East was interpreted by the market as a sign of a hardening of Washington’s foreign policy, which historically has had immediate effects on crude oil volatility.
Analysts’ expectations
Experts at SEB bank point out that the pressure on prices is not only due to weather conditions, but also to the geopolitical context. Meanwhile, analysts at Phillip Nova noted that production cuts in the US are driving a slight rebound, albeit limited by fears of oversupply as Kazakhstan normalizes its exports.
In the short term, the market continues to closely monitor weather conditions in North America, the evolution of tensions in the Middle East and the pace of supply recovery in Central Asia.
Source: Reuters
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