The Arab Energy Organization (formerly OAPEC) expects global oil prices to rise, amid efforts by refineries, especially in Asia, to search for new sources of supply.
The Secretary-General of the organization, Jamal Al-Loughani, said today, Wednesday, January 15, 2025, that the decision to tighten US economic sanctions on the energy sector in Russia played a major role in bringing crude oil futures prices to their highest levels in about 3 months.
Al-Loughani added in statements monitored by the specialized energy platform (based in Washington) – that the price of Brent crude rose at the end of the second week of January by 4.2% on a weekly basis, to reach $79.76 per barrel.
The prices of US West Texas Intermediate crude futures rose, coinciding with the issuance of the broad US decision against the Russian oil sector, by 3.5%, to reach $76.57 per barrel.
The Secretary-General of the Arab Energy Organization explained that the rise in oil prices was driven by concerns about the possibility of a shortage in Russian oil supplies and a decline in Russian oil exports, expecting that the cost would become greater for major buyers in India and China.
Al-Loughani explained that the decision is pushing Chinese and Indian crude oil refineries to seek more oil from the Middle East, Africa and the Americas, which could contribute significantly to boosting oil prices and raising shipping costs, as a result of reducing the fleet of tankers available to transport crude oil from Russia in the short term.
He explained that spot crude oil prices for the Middle East, Africa and Brazil have risen in recent months, coinciding with the rise in demand from China and India and the decline in crude oil supplies from Russia and Iran, and their increased costs.
Al-Loughani noted that the Chinese Shandong Group recently issued a notice prohibiting oil ships subject to US sanctions from entering its main ports located on China’s east coast, which could restrict the arrival of Russian and Iranian oil imports.