Receive our newsletter – data, insights and analysis delivered to you
March 26, 2015

Oil drops as Middle East supply concerns ease

The price of Brent crude oil fell by over $1 a barrel today, on estimations that the threat of disruption to Middle East supplies due to air strikes in Yemen was low.

By admin-demo

The price of Brent crude oil fell by over $1 a barrel today, on estimations that the threat of disruption to Middle East supplies due to air strikes in Yemen was low.

Reuters reported that North Sea Brent crude was down 90 cents to $58.29 a barrel, while US crude dropped $1 to $50.43 a barrel.

Saudi Arabia and its Gulf Arab allies started a military operation in Yemen, including air strikes, against Iran-backed Houthi rebels.

"The risk for the weekend and early next week is the possibility of a political agreement [with] Iran."

Goldman Sachs reported that the strikes in Yemen would have little effect on oil supplies, as the country was only a small crude exporter, and tankers may avoid passing its waters to reach their ports of destination.

Yemen had a production of about 145,000 barrels per day in 2014.

Closure of the Bab el-Mandeb strait is expected to impact 3.8 million barrels a day of crude and product flows.

Content from our partners
Green investment: What gives Scotland multiple advantages
How the North of Tyne region is leveraging its legacy to define its future
Q&A with Chevron Lubricants’ Paul Sly, global industrial OEM specialist, and Nathan Knotts, global brand technical manager

Goldman said any nuclear agreement with Iran may not lead to higher Iranian oil exports before the second half of 2015.

Swiss analyst Olivier Jakob was quoted by Reuters as saying: "The risk for the weekend and early next week is the possibility of a political agreement [with] Iran.

"We want to be positioned for the possibility of the Strait of Hormuz opening up, rather than for the possibility of the Bab el-Mandeb shutting down."

Related Companies

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Friday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU