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Oil is rising in price because of clashes in Iraq yesterday, there was a significant jump in prices for Brent crude oil

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Oil is rising in price because of clashes in Iraq yesterday, there was a significant jump in prices for Brent crude oil
October 17
16:00 2017

Renewed tensions in the Middle East became the reason for such a sharp rise in prices the day before. Today there is a continuation of the price increase; however it occurs smoothly, not rapidly as on Monday.

So, at three o’clock in the afternoon (Moscow time), December futures for Brent crude oil were being traded at the London Stock Exchange ICE Futures at $ 58.02 / bbl. Thus, the increase in the price since the close of trading at the previous session was 0.35% (or 0.2 USD in absolute figures).

WTI, also known as Texas light sweet (traded on the New York Mercantile Exchange NYMEX), showed quite a steady rise in quotations too. So, futures for November are being traded at $ 52 per barrel. This is 0.27% or $ 0.14 more than the price of the closing at the previous session.

The reason for such a serious growth is not a secret for investors and market analysts. This happened because of the armed clashes in Kirkuk province, Iraq. Due to the tense situation, oil production in Kirkuk was suspended. Thus, the country loses 275,000 barrels of oil per day.

Analysts note that the stop of mining in Kirkuk will not have a serious impact on the world of oil production. Nevertheless, the price jump was significant. It was explained by the fears of experts that the conflict would expand and drag on time.

Fatih Birol, Executive Director of the International Energy Agency said that it was too early to draw conclusions about the influence of the situation in Kirkuk as well as the global oil production.

We assume that the upward trend in oil quotations will continue for some time, then a slight correction will occur.

The material was prepared with the participation of Andrey Majorov,
a leading analyst of the brokerage company CT Trade

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