Commodities News

Oil Back at $120 After Jeddah Attack; Finishes With Best Week in Four

By Barani Krishnan — A missile strike at a Saudi Arabian oil storage depot in Jeddah sent crude prices up more than 1% Friday, reversing a 2% drop from earlier in the day and giving the market its best weekly gain since the Russian invasion of Ukraine.

Yemeni Houthi rebels appeared to be behind the attack, with a spokesperson for the group saying it “would be announcing more details on a wide operation in Saudi Arabia” later in the day.

Twitter was ablaze with visuals of a huge plume of black smoke seen rising in Jeddah, the second largest Saudi city after capital Riyadh, where state-owned oil firm Aramco (SE:2222) has several facilities.

“It’s the last thing we need in a tight market situation like this but I guess oil bulls can thank the Houthis for sending crude back to $120 levels before the weekend,” said John Kilduff, partner at New York energy hedge fund Again Capital.

​​London-traded Brent, the global benchmark for oil, settled up $1.62, or 1.4%, at $120.65 per barrel. It had fallen more than 2% earlier, touching a session low of $115.21.

For the week, Brent was up 11.8% after accounting for other price spikes on Monday and Wednesday. It was Brent’s biggest weekly gain since the 20% rally in the week that marked the start of Russia’s Feb. 24 invasion of Ukraine.

U.S. crude’s West Texas Intermediate, or WTI, benchmark settled up $1.56, or 1.4%, at $113.90. WTI was down to as much as $108.77 earlier. For the week, the US crude benchmark rose 8.8%.

Crude prices fell earlier on the easing of some supply concerns on the European market, particularly the partial export resumption from Kazakhstan’s CPC crude terminal that Russia’s energy minister said on Wednesday might be out for two months due to storm damages.

A coordinated release of crude from the emergency reserves of the United States and other consuming countries also weighed on prices earlier, with reports that more than 30 million barrels might come from the U.S. to ease the oil deficit heightened by the month-long Russian-Ukraine war.

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