[원유마감]WTI 4%↓… “The Suez Canal accident is a temporary noise”

On the 24th (local time), the 400m-long super-large container ship’MV Ever Given’ in Panama was stranded diagonally at the Suez Canal in Ismailia, Egypt, completely blocking traffic. © AFP=News1

International oil prices plunged by 4% and fluctuated again.

Futures for May delivery of Western Texas Crude Oil (WTI) in the US on the 25th (local time) fell by $2.62 (4.3%) from the battlefield to $58.56 per barrel.

North Sea Brent oil May also pushed $2.46 (3.8%) to $61.95 per barrel.

Oil prices have fluctuated sharply this week. Three days ago, it plunged 6% due to worsening infectious diseases in Europe, and then surged 6% due to the paralysis of the Suez Canal in Egypt due to a ship aground the next day, but it fell again by 4% on that day.

Ships that completely blocked the Suez Canal, the main route for maritime logistics between Asia and Europe, have not yet been lifted, and the canal operation has been blocked in both directions.

However, first of all, market participants determined that the supply disruption caused by the Suez Canal blockade would be short-term and side-effects, and oil prices appear to have plunged again on that day. “Most accidents only create’noise’ in the market,” said Julius Bear Bank analyst Norbert Luquet. “It doesn’t have any lasting impact on fundamentals (the market as a whole).” Ship accidents are only a temporary factor.

In addition, uncertainty was somewhat reduced in that the time was set and expected to be 28 to 29 days when the maximum period of time for a stranded ship to be lifted is expected to be the maximum (difference between high tide and low tide).

On the other hand, in Europe, restrictions on economic activity were extended or added due to worsening infectious diseases, and the contracted demand for crude oil surpassed the temporary supply shortage caused by the paralysis of the Suez Canal.

Wood McKinsey’s vice president Anne-Louis Hittle said the delay in oil or petroleum products going to Europe and the United States through the Suez Canal would not have a long-term impact on overall oil prices.

In addition, most of the final destinations of oil tankers passing through the Suez Canal are Europe, but the impact of this accident is limited in that the current demand for crude oil in Europe is weak due to re-blockade.

“If the infectious disease situation in Europe wasn’t as serious as it is now, the oil supply disruption could be a fairly long-term problem,” said Vjonaar Tonghagen, analyst at Listad Energy. Because of this, he explained that the oil price on the same day quickly adjusted the sharp rise the previous day and fell by 4%.

Eventually, the market’s attention has to be focused on the OPEC Plus (+) meeting scheduled in early April. Jeffrey Harley, senior market analyst at Oanda Securities, said, “It is unlikely that oil prices will resume rising momentum before the OPEC+ meeting early next month.”

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