Turmoil Continues in Middle East
February 20, 2024
Turmoil continues in the Middle East. There were reports that a rocket fired by Yemen Houthi rebels in the Red Sea hit an oil tanker heading to India. Hezbollah also fired dozens of rockets at a northern Israel town in response to 10 civilians killed in southern Lebanon. The increase in violence is one of the main reasons the IEA lowered its world demand growth forecast.
The energy markets continue to trade in a range and traders are watching the news. A risk premium has been put into the market with all the uncertainty surrounding it. Traders continue to watch for escalation in the Middle East tensions or any other event that upsets energy supply and demand.
Russian refinery rates have dropped as Ukrainian drones attacks deep in Russian territory have disrupted operations. According to Bloomberg, rates slumped 380,000 bpd and are running at 5.16 million bpd in the second week of February, which is the lowest since early October 2023.