Oil Prices Stagnant Amid Ongoing Supply Disruptions
The Brent crude oil price has been stagnant this week as investors assess the impact of the East-to-West pipeline closure on global supplies. The global benchmark, Brent, is trading at $105.68, slightly below its month-high of $109.96.
A highly bullish pattern is forming, which may lead to a strong breakout. Analysts are warning of an oil price surge, with Goldman Sachs predicting that oil may retest the year-to-date high of $120.
The situation in the Middle East remains complex, with Saudi Arabia's efforts to boost supplies through ship-to-ship transfers being overshadowed by the risk of further attacks on key infrastructure. The Strait of Hormuz will continue to be closed by Iran and the US until after the midterm elections in November, affecting millions of barrels of oil.
China's rising oil demand is also contributing to the supply squeeze, with analysts estimating that China's oil imports will rise by over 1.2 million barrels a day in the fourth quarter of the year.