Oil closes 1.5% higher on supply shortage fears

Oil closed higher today, May 15, snapping is losing streak amid supply shortage fears.

Brent crude futures rose 1.4% to settle at $75.23 a barrel. West Texas Intermediate (WTI) crude settled at $71.11 a barrel, up $1.07, or 1.5%.

As populations and economies grow, the world will need more energy in the coming decades, OPEC Secretary-General Haitham Al-Ghais said in a statement, reiterating that the current underinvestment must be rectified.

“For the oil industry alone, which will make up almost 29% of the world’s energy needs by 2045, global investment requirements total $12.1 trillion between now and then. This equates to more than $500 billion each year,” he said. Fears of supply shortages increased after forest fires broke out in Alberta, Canada, affecting supplies estimated at 300,000 barrels per day. Meanwhile, crude oil flows from northern Iraq to the Turkish port of Ceyhan have not yet resumed.

Concerns over a slowdown in the global economy capped gains, as the NY Empire State Manufacturing Index showed that activity contracted sharply in May, after the index posted growth for the first time in eight months in April. According to data compiled by Bloomberg, the average seaborne Russian oil shipments increased during the four weeks ended May 12. Brent crude futures rose 1.4% to settle at $75.23 a barrel. West Texas Intermediate (WTI) crude settled at $71.11 a barrel, up $1.07, or 1.5%.