Crude oil rates $90 per barrel due to tensions in Ukraine and Middle East

Dubai/London – The tension increasing between Russia-Ukraine and the Middle East and the central Asian regions has caused the crude oil rates to peak at $90 per barrel. Before this, a rate of $90 per barrel of crude oil was seen in October 2014. As the demand for crude oil has been increasing for the last few months and the supply has stagnated, the crude oil rates are rising consistently. International financial institutions and think tanks have predicted a rate of $100 per barrel soon.

Moreover, the tension between Russia and Ukraine is festering by the day and the repercussions are being felt even in the international markets. On Wednesday, crude oil rates spurted by nearly 2% in the international markets, reaching $90 per barrel. On Thursday morning, a slight decline was noted, but the crude oil rates jumped once again by 1%, reaching $90.85 per barrel. The rate for WTI crude from the United States has also crossed $88 per barrel. These are the highest since October 2014 and have become a record for the last seven years.

Moreover, the international financial institutions and think tanks have pointed out that the crude oil rates could scale the $100 per barrel level against the background of the rising rates. US financial institution Goldman Sachs has predicted in this respect that the crude oil rates will be $105 per barrel by the beginning of the following year. Atlantic Council Global Energy Centre has claimed that the crude oil rates will remain above $85 per barrel for the next few days. Analysts at Rystad energy have pointed out that the crude oil rate of $100 per barrel could become a reality.

Furthermore, analysts claim that factors other than the Russia-Ukraine tension may increase crude oil rates. The drone attacks on the United Arab Emirates and the subsequent increase in the intensity of the conflict against Houthi rebels, mishap at the Iraq-Turkey fuel pipeline and instability in Nigeria and Kazakhstan have contributed to the crude price hike. At the same time, although the OPEC member countries have decided to increase crude oil production, they have not been able to reach the expected production level. Therefore, although the demand is constant, the supply of crude oil has remained limited. Analysts claim that the effects will be visible in the fuel markets for the next few days.