Oman crude prices on Wednesday jumped to their highest level in a year as the oil output cuts by Saudi Arabia and a US snowstorm pushed global oil prices to the pre-pendemic levels.
Following a 3.2 per cent price surge on Tuesday, Oman crude price (for April delivery) increased by 1.5 per cent on Wednesday to close at US$57.72 per barrel at the Dubai Mercantile Exchange.
Meanwhile, the prices of other global crude benchmarks also surged on the back of upbeat market sentiment and a snowstorm that socked the northeastern United States. US benchmark West Texas Intermediate (WTI) oil soared to one-year high of around US$55.07 a barrel, while Brent North Sea crude hit US$57.77, a level last reached nearly a year ago.
Oil prices have witnessed a steady rise in the past few days after the pandemic-driven concerns over a supply glut were eased with massive output cuts by Saudi Arabia. The voluntary cuts of 1mn barrels per day by Saudi Arabia began at the start of February and will run through March.
“Oil prices powered higher… lifted in part by the positive sentiment returning to equity markets, but mostly because of frigid weather sweeping the United States, pushing up the demand for heating,” OANDA analyst Jeffrey Halley told AFP.
The rebound in oil prices marked a stunning turnaround for the crude market, which briefly turned negative last year as the deadly COVID-19 outbreak shuttered economies worldwide and caused a supply glut that sent traders scrambling.
Oman crude prices last year averaged at US$46 per barrel, a decline of 27.6 per cent compared with the average oil price in 2019. The sultanate’s total oil exports decreased by 7.5 per cent to 287mn barrels in 2020 against 310.3mn barrels in the previous year.
(With inputs from agencies)