Oil prices rebound on fears Suez Canal blockage may last weeks

Oil prices bounced back on Friday from a plunge a day earlier on concerns that a large container ship that ran aground in the Suez Canal may block the vital shipping lane for weeks, squeezing supply. Prices, however, were still headed for a third consecutive weekly loss. Brent crude was higher by 43 cents, or 0.7%, at $62.38 a barrel by 0028 GMT, after dropping 3.8% on Thursday.

U.S. West Texas Intermediate (WTI) crude was up49 cents, or 0.8%, at $59.05 a barrel, having tumbled 4.3% a day earlier. Both benchmarks were on track for a weekly loss of more than 3%, following a more than 6% decline last week. The trapped container ship is blocking traffic in the Suez Canal, one of the world’s busiest shipping channels for oil and refined fuels, grain and other trade between Asia and Europe.

Officials stopped all ships entering the canal on Thursday, and a salvage company said the vessel may take weeks to free. Countries in Europe are renewing restrictions to curbthe spread of COVID-19, which will likely reduce fuel demand from the region. Germany, Europe’s largest economy, has seen its biggest increase in coronavirus cases since January. In parts of western India, authorities ordered peopleindoors as new infections hit the highest level in five months.

Oil prices rebound on fears Suez Canal blockage may last weeks, Reuters, Mar 26