Oil prices have risen for a seventh consecutive week as a global energy demand remains extremely high amid tightening supplies in Europe and Asia.
Oil futures in New York extended gains toward $80 U.S. a barrel, a level they haven’t hit since 2014. The U.S. Energy Department said that it has no plans to tap America’s oil reserves, easing concerns that higher prices could be met with emergency supply.
West Texas Intermediate crude oil climbed 1.4% to $79.42 U.S. a barrel in London trading. Brent crude oil for December settlement rose 1.4% to $83.06 U.S.
The economic recovery from the pandemic along with a supply disruption in the Gulf of Mexico following Hurricane Ida had already tightened the market before rising natural gas prices spurred additional demand for oil products such as diesel and fuel oil.
The squeeze, which is being exacerbated by higher coal prices, has come ahead of an expected increase in fuel consumption during the coming winter months.
While Russia is offering some relief to Europe with increased natural gas flows, China is still facing power outages and Beijing has ordered its state-owned firms to secure energy supplies for winter at all costs.
Chinese fuel oil futures jumped almost 10% today (October 8) as local markets resumed after a weeklong national holiday.
In Canada, gasoline prices hit all-time highs in many parts of the country as Canadians hit the road for the Thanksgiving long weekend.
Data from Natural Resources Canada, which tracks fuel prices across the country, shows the average weighted national retail price for regular gasoline in Canada reached $1.45 per litre this week. That's more than 40 cents higher year-over-year and the highest weekly average price on record.
