Oil prices hit 7-year highs as tight supply bites; not affected by virus

Oil prices hit 7-year highs as tight supply bites; not affected by virus

Benchmark oil prices climbed to their highest level since 2014 on Tuesday as possible supply disruption after attacks in the Mideast Gulf added to an already tight supply outlook. Brent crude futures rose $0.88, or 1%, to $87.36 a barrel by 1154 GMT, while US West Texas Intermediate (WTI) crude futures jumped $1.23, or 1.5%, to $85.05 a barrel. Trade on Monday was subdued as it was a US public holiday. Both benchmarks touched their highest levels since October 2014 earlier in Tuesday’s session. UAE oil firm ADNOC said it had activated business continuity plans to ensure uninterrupted supply of products to its local and international customers after an incident at its Mussafah fuel depot. Also adding to geopolitical price premiums are rising tensions between OPEC+ member Russia and Ukraine. In addition, some producers within the Organization of the Petroleum Exporting Countries (OPEC) are struggling to pump at their allowed capacities, due to underinvestment and outages, under an agreement with Russia and allies to add 400,000 barrels per day each month. Opec will release its January oil market report at 1230 GMT. “The consensus is that the situation will not improve in the foreseeable future and oil demand growth together