The oil price has risen sharply this week. Attacks by Houthi rebels on several ships in the Red Sea caused considerable unrest on the oil market. This is also noticeable on the diesel markets.
The oil price has risen sharply this week. On Thursday, December 14, the Brent benchmark was at $76,61. With the exception of the slight drop on Friday, December 15 to €76,55, the price rose almost all week. On Wednesday, December 20, the price was at the highest point of the week, at €79,70.
The oil price suffered a significant blow due to the attack by Houthi rebels. In solidarity with the Palestinians, Houthi rebels from Yemen attacked at least eight ships in the Red Sea with drones and anti-ship missiles. Initially, ships with a link to Israel were attacked, but now it is a risk for any ship to sail through the Red Sea.
The situation mainly threatens the European oil market. The Red Sea is the only Suez Canal gateway for Europe shipping from the Middle East to Europe. As a result, the majority of the oil supplied to Europe is threatened by the situation. Shipping companies are taking the situation extremely seriously. On Saturday, December 16, the Danish shipping company A.P. Moller-Maersk and the German Hapag-Lloyd announced that they would no longer sail through the Red Sea. Shipping companies from all over the world are probably choosing to detour via the Cape of Good Hope for the time being. Shipping goods to Europe takes at least ten days longer, which increases fuel and personnel costs. It is very likely that this will translate into a higher oil price. BP has now indicated that it will no longer transport oil through the Red Sea.
American reserves
The price has now dropped slightly again. According to the American Energy Agency (EIA), production in the US reached a new record level of 13,3 million barrels per week. While supply in the US is increasing sharply, demand is decreasing. Contrary to market expectations, oil supplies rose by 2,3 million barrels. However, a Reuters survey of economists showed expectations that oil supplies would decline by 2,3 million barrels.
The diesel price is clearly responding to the higher oil price. On Thursday, December 14, 100 liters of diesel were sold for €125,10. On Wednesday, December 20, the price rose to 128,01. This should not be surprising. Russian Ural oil, from which most of the diesel is made, rose along with the Brent benchmark from $59,05 on Thursday, December 14, to $63,12 on Wednesday, December 20.