Brent: Supply risks keep prices elevated – ING

ING analysts Warren Patterson and Ewa Manthey say Brent remains supported as the oil market reprices ongoing supply disruptions linked to the US-Iran standoff and tensions in the Persian Gulf. They highlight stronger Brent above $110/bbl, constrained Iraqi exports via the Strait of Hormuz, and the expiry of a US waiver on Russian oil sales, all reinforcing market tightness.

Brent supported by tightening supply

"The oil market continues to reprice ongoing supply disruptions, with last week's Trump-Xi talks yielding no tangible progress in the Middle East."

"It’s no surprise that Brent is trading stronger this morning after the aggressive rhetoric, moving convincingly above $110/bbl."

"Meanwhile, Iraq’s oil ministry said that despite the disruptions in flows through the Strait of Hormuz, the country still managed to export 10m barrels of oil in April."

"The ongoing supply disruptions mean the market has had to rely largely on inventory and alternative supply, where possible. This has included Russian oil, following the US's issuance of a waiver for Russian oil sales."

"However, this waiver expired over the weekend, and the US has not extended it so far, despite the significant tightness in the oil market."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)