13/12/2022–|Last update: 12/13/202203:12 PM (Makkah Al-Mukarramah)
Oil extended its gains today, Tuesday, as a major pipeline carrying resources to the United States continued to shut down, raising concerns about a possible supply shortage in the world’s largest consumer of crude.
Brent crude futures rose 1.5%, to $79.15 a barrel by 05:25 UTC, while US West Texas Intermediate crude futures rose 1.4%, to $74.22. Both benchmarks rose more than 2% when settled in the previous session.
Concerns about Russian oil production arose after President Vladimir Putin said last Friday that his country might cut production.
The closure of TC Energy’s Keystone pipeline – through which about 620,000 barrels per day of Canadian crude is shipped from Alberta to the United States – reduced supplies and raised the possibility of a stockpile drawdown at the Cushing, Oklahoma storage hub. .
The Keystone pipeline has been closed since the discovery of a 14,000-barrel leak in the US state of Kansas on December 7.
TC Energy did not issue a timetable for restarting the line, which carries crude to refineries in the Midwest and Gulf Coast.
Oil prices also received some support from expectations that the easing of COVID-19 restrictions in China, the world’s second largest oil consumer, will boost demand.
China lifted some of its tough coronavirus restrictions over the past week, including relaxing COVID-19 testing requirements and stopping tracking of people’s travel records for virus-related purposes.