Brent Crude Increases Over $86 Per Barrel
Brent crude oil prices hit their highest level in years on Monday as demand recovers, reaching $86 per barrel, recording a 1% increase.
World oil prices increased 1%, with the price of December for Brent crude adding up to above $86 per barrel in the early hours of Monday, reaching a record high for the first time since 2018.
The price of November futures for WTI crude rose 1.15% on Monday, up to $82.86 per barrel.
American stocks increase
US contracts dipped after American stocks advanced on Friday, with the S&P 500 chalking its best week since July as earnings buoyed sentiment.
Bond rates in New Zealand and Australia surged as inflation in New Zealand reached its highest level in ten years. Australia's three-year bond yields jumped 18 basis points to their highest level since January. The dollar crept higher as ten-year Treasury yields climbed back toward 1.6%.
Oil prices increased for the eighth week in a row, with West Texas Intermediate crude surpassing $83 per barrel for the first time since 2014. Brent crude oil was approaching $86 per barrel.
Investors are still concerned about inflation as a result of rising energy shortages, which are causing more production cuts and pushing bond yields higher.
Road to recovery
The economic recovery remains patchy while central bankers are moving closer to paring back stimulus. US consumer sentiment fell unexpectedly in early October, but retail sales still increased.
“We are starting to see some cracks in the transitory narrative that we’ve been hearing for quite some time,” Meera Pandit, global market strategist at J.P. Morgan Asset Management, said on Bloomberg radio.
She added, “Rates will continue to ground higher from where we are. But I don’t think from a Fed perspective, when you think about the short end of the curve, that they are going to move much earlier than 2023. They are going to be a little bit more patient than the market expects right now.”
Increase after a decrease
Last Monday, American crude oil rose $1.15 or 1.5% to $80.5 a barrel, the highest level since late 2014, noting that it had already increased 4.6%, while Brent crude rose 81 cents, or 1%, reaching $83.20 a barrel, after rising nearly 4% the week before.
However, the increase was after a decrease at the beginning of October. Crude oil prices fell during the day trading following a record multi-year high during which prices reached more than $83 a barrel.
The global price benchmark for Brent crude contracts decreased by 1.7% to record an $81.12 a barrel, after having jumped earlier to $83.47, hitting its highest price level since October 2018.