Crude Ends 2023 Down, Tensions In Red Sea Rise

Oil was moderately lower on Friday with Brent down 0.1% to $77.08/bbl and WTI -0.6% to $71.33 and both ending the year down despite OPEC reducing output over 2023. But with an attack by Houthi rebels on a Maersk container ship in the Red Sea on the weekend, the market may again get nervous about the impact of violence in this major oil and gas shipping route.

• Brent reached a high of almost $78 on Friday before falling to a low of $76.73. WTI rose to $72.62 and then fell to $71.25. Markets remain concerned about excess supply in the market.
• Red Sea tensions remain heightened with Iran sending a warship to the waterway following the US military sinking Houthi boats which were attacking the Maersk ship. Maersk has again said it will divert ships around southern Africa. The risks in the area have meant that half of the Red Sea’s container traffic is finding alternative routes and also some tankers, but longer journey times will add to costs.