Oil prices hit more than $119 a barrel

LONDON, Mar 09 (Reuters): Oil prices surged to more than $119 a barrel on Monday, hitting levels not seen since mid-2022, as some major producers cut supplies and fears of prolonged shipping disruptions gripped the market due to the expanding US-Israeli war with Iran.

Brent crude futures were up $12.77, or 14 per cent, at $105.46 per barrel at 1126 GMT, while US West Texas Intermediate (WTI) crude futures were up $12.66, or 14 per cent, at $103.56.

In a whiplash session, Brent had earlier hit a high of $119.50 a barrel, indicating its biggest-ever absolute price jump in a single day, and WTI reached $119.48 a barrel.

Brent has surged as much as 66 per cent and WTI 77 per cent since their last close before US and Israel started attacks on February 28.

Monday's prices compare with all-time highs of around $147 a barrel for the contracts in 2008, according to LSEG data going back to the 1980s.

The premium of front-month loading Brent contracts over contracts for delivery in six months' time surged to an all-time high on Monday of almost $36, according to LSEG data going back to 2004.

That was well above its previous summit of around $23 in March 2022 in the early weeks of the Russia-Ukraine war.

This premium indicates a market structure known as backwardation, showing traders see intense current supply shortages.