(FT) The international oil benchmark, Brent crude, rose to a two-month high of $120.50 a barrel on Monday as markets warmed up for bottlenecks in the supply of the commodity.
The US benchmark West Texas Intermediate also rose on Monday to hit $116 a barrel. The Brent contract for August delivery rose by 0.5% at $116.20 a barrel, while the gas oil contract in Europe traded close to a record high of $1,200 a ton.
The rising oil prices come as refined fuel prices get boosted by tight supplies at key delivery hubs. Lower exports from Russia have also tightened the oil markets, especially crude.
A potential decision by the EU to restrict oil purchases from Russia is also reportedly weighing on prices. EU members are already scheduled to meet on Monday and Tuesday to decide on the oil impasse, with some members, such as Hungary, opposed to a total ban.
Oil supply concerns are also seen to occur after Iran seized two Greek-flagged tankers on Friday that were passing through the Strait of Hormuz.
Markets are also warming up to an OPEC+ meeting on Thursday in which the cartel is expected to stick with its output hike of 400,000 barrels a month. The cartel has in the past declined to heed calls for more oil.
Despite the surge, oil is still expected to continue getting supported by the easing of Covid-19 restrictions and political decisions taken by governments, including subsidies.
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