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Oil Prices Rebound: Geopolitical Tensions And Supply Concerns Drive 2% Surge
(MENAFN- The Rio Times) The global oil market witnessed a significant turnaround on Wednesday, with prices climbing over 2% after a sharp decline the previous day.
This recovery pushed Brent crude, the international benchmark, back above the $70 per barrel mark. Brent crude futures for November delivery rose 2.05% to $70.61 per barrel on the Intercontinental Exchange in London.
Meanwhile, West Texas Intermediate (WTI ) crude for October delivery jumped 2.37% to $67.31 per barrel on the New York Mercantile Exchange. The price rebound was primarily fueled by escalating tensions in the Middle East.
Israeli forces killed at least six Palestinians in separate incidents in the West Bank. The troops continued extended operations against militant groups in the region.
These military actions in northern Israel over the past two weeks, including prolonged incursions in Tubas, Jenin, and Tulkarm, have heightened concerns about potential supply disruptions.
Armed factions such as Hamas, Iranian-backed Islamic Jihad, and Fatah strongly control these areas.
Market Dynamics and Oil Inventory Trends
Adding to the market dynamics, U.S. crude oil inventories increased by 833,000 barrels in the week ending September 6, according to the Department of Energy.
This figure surpassed analysts' expectations of a 700,000-barrel rise. The oil market's volatility reflects ongoing uncertainties in global supply and demand.
Just a day earlier, Brent crude had fallen below $70 per barrel, its lowest level since December 2021. This drop occurred after OPEC reduced its global demand forecast for the second time in two months.
OPEC now anticipates demand growth of about 2 million barrels per day (bpd) in 2024. This is a reduction of 80,000 bpd from its previous forecast.
For 2025, the expectation is for an increase of 1.7 million bpd, 40,000 bpd lower than initially projected.
These fluctuations underscore the delicate balance in the oil market, where geopolitical events and economic forecasts can swiftly impact prices.
As the industry navigates these challenges, investors and analysts remain vigilant. They are closely monitoring both supply risks and demand concerns in this crucial global commodity.
This recovery pushed Brent crude, the international benchmark, back above the $70 per barrel mark. Brent crude futures for November delivery rose 2.05% to $70.61 per barrel on the Intercontinental Exchange in London.
Meanwhile, West Texas Intermediate (WTI ) crude for October delivery jumped 2.37% to $67.31 per barrel on the New York Mercantile Exchange. The price rebound was primarily fueled by escalating tensions in the Middle East.
Israeli forces killed at least six Palestinians in separate incidents in the West Bank. The troops continued extended operations against militant groups in the region.
These military actions in northern Israel over the past two weeks, including prolonged incursions in Tubas, Jenin, and Tulkarm, have heightened concerns about potential supply disruptions.
Armed factions such as Hamas, Iranian-backed Islamic Jihad, and Fatah strongly control these areas.
Market Dynamics and Oil Inventory Trends
Adding to the market dynamics, U.S. crude oil inventories increased by 833,000 barrels in the week ending September 6, according to the Department of Energy.
This figure surpassed analysts' expectations of a 700,000-barrel rise. The oil market's volatility reflects ongoing uncertainties in global supply and demand.
Just a day earlier, Brent crude had fallen below $70 per barrel, its lowest level since December 2021. This drop occurred after OPEC reduced its global demand forecast for the second time in two months.
OPEC now anticipates demand growth of about 2 million barrels per day (bpd) in 2024. This is a reduction of 80,000 bpd from its previous forecast.
For 2025, the expectation is for an increase of 1.7 million bpd, 40,000 bpd lower than initially projected.
These fluctuations underscore the delicate balance in the oil market, where geopolitical events and economic forecasts can swiftly impact prices.
As the industry navigates these challenges, investors and analysts remain vigilant. They are closely monitoring both supply risks and demand concerns in this crucial global commodity.
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