The price of Brent Crude Oil futures (BZ) rose Tuesday making a move over $79 a barrel. Growing supply outages, along with a workers’ strike in Norway, are contributing factors to this recent bullish move.
Multiple recent disturbances highlight the growing trend of supply concerns worldwide. Libya has reported that its oil production decreased by more than 50% over the past few months. Iranian oil exports have been impaired by US sanctions while a lack of investment has crushed oil production in Venezuela. Additionally, a recent strike in Gabon forecasted to remove 54,000 barrels a day from overall production.
Another looming factor in the global oil equation is the growing issue of pipeline availability. Delays in the transport of crude oil from the fields to the refineries has further compounded the supply limitations.
However, with recent agreements by OPEC ministers to increase oil production, this upward price move may be short lived. Crude oil futures are known to be volatile in response to geopolitical and other market forces.
As of Tuesday morning, the August 2018 contract for West Texas Intermediate Crude Oil futures (CL) was up 0.84% and September 2018 Brent Crude Oil futures (BZ) contract was up 1.64%.
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