Muscat – With global oil prices rising for a third week in a row, Oman crude prices on Friday increased to a near three-year peak, boosted by tight global supplies.

At the Dubai Mercantile Exchange (DME), Oman crude contract price (for November delivery) crossed US$75 per barrel mark on Friday before closing at US$74.89 – reaching a high last seen on October 31, 2018.

Global benchmark Brent oil prices also jumped on Friday to the highest level in almost three years, boosted by tight supplies particularly in the US, analysts said.

In late Friday afternoon deals, Brent North Sea crude (for delivery in November) hit US$77.87 per barrel – the highest level since October 29, 2018.

“The price rise is being facilitated by limited supply coupled with robust demand, causing the oil market to tighten noticeably,” said Commerzbank analyst Carsten Fritsch.

Brent prices later stood at US$77.68, up 0.6 per cent from Thursday.

The US oil benchmark West Texas Intermediate (WTI) crude (for November delivery) rose 0.4 per cent to US$73.60 a barrel on Friday.

Global supplies have been disrupted because US production remains hampered by ongoing fallout from Hurricane Ida in the Gulf of Mexico and Louisiana.

The US is both the world’s largest consumer and producer of crude oil.

“Underpinning the latest bout of price strength is a tightening supply backdrop,” added PVM analyst Stephen Brennock.

“Latest weekly data showed [US] domestic crude stocks fell to their lowest level in three years amid continued production outages in the Gulf of Mexico.”

Brennock concluded, “Hurricane Ida may be long gone but it is still causing problems for the US.”

With sharp increases in global crude prices this year, the average price of Oman crude during the first eight months of 2021 surged by nearly 48 per cent compared to the average price recorded in 2020.

The sultanate achieved an average price of US$67.9 per barrel for its oil shipments during the January–August period of this year, which is 47.6 per cent higher against the average price of US$46 recorded in 2020, according to data released by the National Centre for Statistics and Information.

As per the DME data, the average price of Oman crude in September so far has been at US$72.73 per barrel.

(With inputs form AFP)