Oil prices continued their rally on Tuesday, reaching three-year-highs from fears of supply disruptions and rising gas prices.
International benchmark Brent crude was trading at $79.55 per barrel at 0708 GMT for a 1.05% rise after closing Monday at $78.72 a barrel.
American benchmark West Texas Intermediate (WTI) was at $76.28 per barrel at the same time for a 1.10% increase after it ended the previous session at $75.45 a barrel.
Continuing its upward trend since Aug. 16, Brent oil hit $79.90 a barrel in early trading on Monday due to rising global oil demand after governments lifted social curbs imposed to slow the spread of the coronavirus.
The oil price rally came after supply disruptions caused by Hurricane Ida, which seriously hit the US Gulf of Mexico late last month. This incident resulted in a fall in US crude oil inventories to their lowest level since October 2018.
One of the most influential banks in the commodity markets, Goldman Sachs, on Monday increased its oil price forecast for this year by $10 per barrel to $90.
Goldman Sachs attributed its price revision to the faster-than-expected recovery in fuel demand after the impacts from the Delta variant of COVID-19 and to the contraction in global supply with the decline in US crude oil stocks.
Similarly, the Wall Street bank revised up its oil price estimate, lifting its previous US crude oil price of $77 a barrel to $87 per barrel.
The record increase in natural gas prices is also supporting the upward movements in oil prices. Experts predict that the gas price crisis may also increase demand for alternative fuels, pushing electricity companies to use oil instead of gas for production.
Investors are now keeping tabs on the upcoming OPEC+ meeting to be held on Oct. 4 when producers will review their output policy after sticking with supply increases of 400,000 barrels per day in recent months.
By Sibel Morrow