Oil prices surged around 8% in London and 9% in New York, posting the biggest weekly gain since July. Brent futures closed the week with a 7.9% gain, trading above $96 per barrel, while West Texas Intermediate accumulated a 9.69% gain, trading at $91.48 per barrel. This was the biggest weekly gain since July 24.
The renewed wave of attacks in the Middle East continues to support prices, with the US and Iran unable to reach an agreement to end the war now in its seventh month, causing major disruption to global energy supplies. Average diesel prices in the US hit record highs, with escalating tensions between the US and Iran and Ukrainian attacks on Russian refineries widening supply disruptions.
Faced with the prospect of a sharp rise in prices next week, the Portuguese government decided to increase the discount on the Excise Duty on Petroleum Products by about three cents per liter. With this increase, diesel should rise by about 12 cents per liter to around 2.12 euros, while 95 gasoline should reach 2.1 euros after a nine-cent rise.
Fears of inflation increases due to higher fuel prices fueled a surge in global debt interest rates, with investors fleeing from debt. As Rystad Energy's chief economist Claudio Galimberti told Reuters, all sectors of the economy are affected by diesel, which explains why US Treasury yields are so high, reflecting the expectation that inflation will continue to rise.
