Crude oil prices and energy-related ETFs strengthened Tuesday after a pipeline blast in Libya and bullish Saudi Arabia budget forecasts sent prices to their highest levels since mid-2015.
On Tuesday, the United States Oil Fund (NYSEArca: USO), which tracks West Texas Intermediate crude oil futures, rose 2.5% and the United States Brent Oil Fund (NYSEArca: BNO), which tracks Brent crude oil futures, gained 2.6%. Over the past three months, USO increased 13.9% while BNO advanced 12.1%.
Meanwhile, WTI crude oil futures was up 2.3% to $59.8 per barrel on Tuesday while Brent crude was 2.4% higher to $66.8 per barrel.
Oil futures touched their highest in more than two years after an explosion at a pipeline operated by Waha Oil, which carries crude to the Es Sider terminal in Libya, reducing output by 60,000 to 70,000 barrels per day, Bloomberg reports.
The blast is “certainly something of a set-back because Libya had been very steadily staying online,” John Kilduff, a partner at Again Capital LLC, told Bloomberg. “It’s just a reminder of the geopolitical risk premium that’s going to haunt this market all of next year.”