By Roslan Khasawneh

SINGAPORE, (Reuters) – Oil prices climbed Friday as frigid conditions swept large swathes across the United States and threatened to disrupt supplies.

The price per barrel increased by 34 cents (or 0.4%) to $91.45 at 0206 GMT. This follows a rise of $1.16 on Thursday.

U.S. West Texas Intermediate crude oil rose 0.5% to $90.73 per barrel. It had gained 2.01 cents on the previous day, putting it above $90 for only the second time since Oct. 6. 2014.

Both benchmarks will be achieving their seventh consecutive weekly gain.

According to Edward Moya (OANDA senior market analyst), “WTI crude soared above the $90 mark after an Arctic explosion made its way through Texas and disrupted some production in the Permian basinin.”

The Northeast United States was hit hard by a massive winter storm on Thursday. This made traveling difficult, and even impossible.

The WTI market structure was in sharp backwardation for six months due to tight oil supply. Friday’s $8.08 per barrel price of WTI fell 7 cents short of the $8.15 record set on Nov. 29, 2008. When spot prices are higher than future prices, backwardation is a phenomenon that encourages traders and oil storage to be removed.

Analysts said that oil markets have become more vulnerable to shocks from supply because of the outpacing demand for recovery.

Moya stated that even though thousands of flights have been cancelled, the energy markets are focused on production and not short-term demand shocks.

The sharp rise in oil prices has been driven by the geopolitical tensions that have developed in Eastern Europe, and Middle East. These tensions have led to Brent futures rising by 17%, and WTI up by 20%.

United States officials warned Russia that it was planning to stage an attack in order to justify its invasion of Ukraine. Russia’s President Vladimir Putin has blamed NATO, the West and increased tensions. Yet, he’s moved thousands more troops to Ukraine’s frontier.

According to Sunward Trading chief analyst Chiyoki Chen: “With Ukraine’s geopolitical risks and only a gradual increase in production by OPEC+,” prices could reach $100 a barrel.

With the Organization of the Petroleum Exporting Countries, Russia’s allies and the Organization of the Petroleum Exporting Countries, also known as OPEC+ agreed this week to keep to moderate growths of 400,000 barrels/day (bpd), despite the fact that the group has been struggling to achieve its existing goals and despite the increasing demand from consumers for more production.

However, analysts believe that oil will soon turn to surplus within the medium-term, which could help curb recent prices surges.

“We expect the sequential trend of quarterly global stock draws will flip to inventory builds as soon as 2Q’22, and sustain for the next 15-18 months,” analysts at Citi Research said in a note late on Thursday.

We believe that a tight market will shift to surplus in order to provide demand coverage for days.