(EnergyAsia, March 28 2014, Friday) — Oil prices continue to hold strong despite numerous attempts by traders and US government to boost supply and weaken market sentiments.
WTI crude has surged past US$101 a barrel while Brent is moving to reclaim US$108 a barrel as tensions between the West and Russia escalate amid continuing supply disruptions in the Middle East and Africa and growing global demand.
The US, Canada and the EU are pushing for greater economic sanctions against Russia after pro-Moscow Crimea voted to secede from Ukraine. Russian troops have taken over most of Crimea’s military and naval bases which the US has described as an annexation of Ukrainian territory.
Two weeks ago, the US Department of Energy attempted to douse the market’s bullish bias when it announced plans to sell five million barrels, or less than 1% of the nation’s Strategic Petroleum Reserve. Oil prices plunged with WTI going to a low of US$98 before recovering above the US$100 level this week amid signs that the West-Russia standoff are worsening.
The weather has not helped the department’s cause either as the east coast of North America continues to experience wintry conditions well into the spring season.
In its latest March report, the department’s Energy Information Administration noted that North Sea Brent crude oil spot price in February averaged near $110 per barrel for the eighth consecutive month, while US WTI were up by US$6 from January to average US$101 per barrel.