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Energy Watch: New abnormal

By Reuters News6 hours ago Updated

Oct 22 (Reuters) - All eyes are back on the Middle East.

Oil prices have been hovering around a five-month high of $110 a barrel in recent days as investors brace for another bout of violence in the region. Fresh Houthi attacks in Saudi Arabia, combined with reports that Israel and the US have drawn up plans for renewed strikes on Iran after the US midterm elections on November 3, have put markets on edge.

Earlier today, Saudi Aramco evacuated staff from its headquarters in the eastern city of Dhahran, likely as a precaution against a possible escalation in the war with Yemen.

The renewed tension in the Gulf might be expected to weigh on oil supplies, but the opposite is the case. Middle East crude exports have rebounded strongly in recent weeks and are now above pre-war levels.

Yet oil prices keep climbing, suggesting investors are increasingly sceptical that these flows can be sustained if the conflict intensifies again.

More on this in my latest column.

https://www.reuters.com/graphics/MIDEAST-CRUDE/zdpxegdeqvx/chart.png

In other news:

The oil and gas price shock is making its mark on household budgets, raising the costs of transport, heating, food, clothing and packaging prices. These graphics show the impact on daily life around the world.
President Donald Trump's deal with Russia to supply diesel to US and global markets is unlikely to meaningfully lower diesel prices, market watchers and analysts said, noting that the promised volumes are too small to ease a global supply squeeze.
Britain on Wednesday approved the Jackdaw North Sea gas field, ending years of legal and political wrangling, as the Labour government seeks to balance its climate goals with ‌energy security concerns.
Asia's imports of liquefied natural gas are likely to rise to a three-month high in October despite the surge in spot prices to the most in almost four years, ROI Asia Commodities Columnist Clyde Russell wrote.
ROI Energy Transition Columnist Gavin Maguire highlighted six emerging US clean power projects that could help meet the country’s growing appetite for electricity.

As ever, don't hesitate to contact me at ron.bousso@thomsonreuters.com or follow me on LinkedIn with any questions or thoughts.

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