Oil Rose Due to Fears That Navigation in The Suez Canal May be Suspended For Weeks

Oil prices rose today by about 2%, to rebound due to fears that the float of a giant, stranded container tanker, impeding the movement of navigation in the Suez Canal, may take weeks, which may put pressure on the supplies of crude and refined products.

But prices are still heading towards losses for the third week in a row, as the outlook for demand is negatively affected by new isolation measures in Europe.

Brent crude rose $1.18, or 1.9 percent, to $63.13 a barrel, after dropping 3.8% on Thursday.

US West Texas Intermediate crude rose $1.25, or 2.1%, to $59.81 a barrel, after shedding 4.3% the previous day.

The two benchmarks are on a weekly loss track, following a 6% drop last week.

The Suez Canal Authority said today, Friday, that the towing operations and the floatation of the stranded ship will resume after the completion of the dredging, of which 87% has been completed.

The company handling the rescue operation said on Thursday that the ship could take weeks to float.

Of the 39.2 million barrels per day of total crude oil imported by sea in 2020, 1.74 million barrels per day used the canal, according to Kepler to track tanker movements. In addition, Kepler said, only slightly less than 9 percent or 1.54 million barrels per day of global refined product imports passed through the Suez Canal.