Oil jumps 10% to surpass $100 again

Oil prices rose sharply today, March 12, ignoring the International Energy Agency's (IEA) announcement of a massive drawdown of strategic reserves aimed at addressing the supply crisis caused by the war in the Middle East.

Brent crude soared 9.25% at $100.47 a barrel, at 05:57 am Makkah time, following an initial jump of 10% to cross $101.59. West Texas Intermediate (WTI) rose 8.75% to $94.90 a barrel.

The IEA approved the release of 400 million barrels of oil reserves to address supply disruptions caused by the war in the Middle East, marking the largest emergency stock release in the agency's history.

The US Department of Energy said that it would release 172 million barrels from the Strategic Petroleum Reserve as part of the IEA’s plan to mitigate market turmoil.

Saul Kavonic, an energy analyst at MST Financial, said the record drawdown would add much-needed volumes to the market, but would only cover a quarter of the 20 million barrel per day supply gap.

He added in comments to CNBC: "The agency's decision also indicates how serious the oil shortage crisis is, suggesting that it does not believe the war will end soon, that current withdrawals will not be enough and more will be needed later, which portends higher prices even after the war ends."

In its monthly report released on March 11, OPEC maintained its forecast for global oil demand growth this year at 1.4 million barrels per day, and at 1.3 million barrels per day for next year.