Oil and gas prices jumped to multi-year highs

2021-07-06 12:01:37
Machine translation
Oil and gas prices jumped to multi-year highs

Oil prices on world stock exchanges rose by 3% due to disagreements between OPEC+ members over a further increase in production quotas, which, against the background of a recovery in oil demand, may lead to a shortage of supply in August. The rise in oil prices followed a rise in natural gas prices in Europe amid the shutdown of two Russian pipelines for repairs. Russia is interested in raising energy prices and is now playing for an increase.


 Negotiations between OPEC + members in Vienna ended without success, and the date of the new meeting has not yet been determined, due to the contradictions that have arisen between Saudi Arabia and the United Arab Emirates (UAE). Saudi Arabia is in favor of increasing production and offers to extend the OPEC + deal until the end of 2022, while the UAE is blocking, trying to get a higher monthly quota for production at higher prices.


September Brent crude futures on the London ICE exchange yesterday reached the level of 7 77.5 per barrel (for the first time since October 2018, exceeding 7 77) as a whole for the month, adding more than 10%.


August futures for US WTI crude oil exceeded 7 76.7 per barrel.


Spot gas prices in Europe, at the TTF hub in the Netherlands, reached 4 464 per thousand cubic meters, showing a record increase in fuel prices in 13 years. The unusual increase in gas prices in the summer is caused by the creation of an artificial deficit on the part of Russia, which suspends two of its gas pipelines for repairs: Yamal-Europe from July 6 to July 10 and Nord Stream from July 13 to 23, without redirecting pumping volumes through Ukraine.


 European traders actively purchased gas for injection into underground storage facilities (UGS), which were only 50% full due to the cold winter and spring, and the decline in supplies led to a shortage and higher prices.


Rising energy prices will once again drive up prices for agricultural products used for the production of biofuels, as well as accelerate sales of electric vehicles in the world to new records.

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