DTN Oil Update
Brent Hits $90, WTI in Pursuit in 6th Day of Iran War
SECAUCUS, N.J. (DTN) -- Brent crude crossed $90 bbl Friday with U.S. West Texas Intermediate crude not far behind, as the Iran war neared its first week, paralyzing about a fifth of global petroleum supplies.
The soaring shortage of energy worldwide forced the U.S. to announce its first reprieve on Russian oil sanctions, allowing Indian refiners to access Russian oil already at sea.
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By 10 a.m. EST, ICE Brent crude for May delivery was up $5.19, or 6%, to $90.60 bbl after hitting a 2-1/2-year high of $91.89. The spread between April and May contracts widened to nearly $6. The global crude benchmark is up 23% since the close of Feb. 27, which marked the eve of the start of U.S.-Israeli airstrikes against Iran.
NYMEX WTI crude futures for April delivery were up $6.69, or 8%, to $87.80 bbl after reaching $89.62 earlier, its highest since October 2023. For this month alone, the U.S. crude benchmark has risen 30%. The spread between the April and May contracts for this benchmark widened to nearly $4.
The Brent-WTI spread narrowed significantly to a low of $2.27 bbl at Friday's peaks for both benchmarks from $5.46 at Friday's settlement.
Refined oil prices rallied sharply too, with diesel hitting near 3-1/2-year peaks and gasoline approaching two-year highs.
NYMEX ULSD futures' front month, April, rose $0.0805 gallon to $3.6948 after reaching $3.7485, a peak not seen since November 2022.
RBOB futures for April delivery added $0.0315 to climb to $2.7024 gallon, after surging to $2.7333, a high since April 2024.
The U.S. Treasury, via its Office of Foreign Assets Control, issued a General License 133 on Thursday, March 4, permitting the sale and delivery of Russian-origin petroleum products already loaded on vessels as of March 5. The reprieve was specifically for India, although it marked the first easing of Russian sanctions by the Trump administration after intensifying them months to try and deprive the Kremlin of oil money used to fund Moscow's occupation of Ukraine.
U.S. and Israeli air raids, meanwhile, hit Iran's defense capabilities for a sixth straight day while Tehran has responded with a barrage of missiles and drones aimed at neighbors such as Saudi Arabia, Bahrain, Oman Kuwait, Qatar, and the UAE who are also U.S. allies.