Oil prices stabilize after a 6% rise over the week

Oil prices stabilized on Monday after surging 6% last week, as rising tensions between Western powers and major oil producers Russia and Iran heightened fears of supply disruptions and kept prices low, Reuters reports, UNN writes.

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Brent crude oil futures fell 0.34%, or 26 cents, to $74.91 per barrel by 09:31 GMT (11:31 Kyiv time), while West Texas Intermediate futures stood at $70.89 per barrel, down 35 cents, or 0.49%.

Both brands last week posted their biggest weekly gains since late September after Russia fired a hypersonic missile at Ukraine as a warning to the United States and Britain following strikes on Russia using Western weapons, the newspaper said.

“Oil prices are starting the new week with some cooling as market participants wait for new cues from geopolitical developments and the Fed’s policy outlook to set the tone,” said Yep Jun Rong, market strategist at IG.

In addition, Iran responded to the resolution adopted by the UN nuclear watchdog on Thursday by ordering measures such as activating various new and improved centrifuges used in uranium enrichment.

“The likelihood of withdrawing some Iranian supplies has increased since Iran’s conviction for its nuclear program, and the regime’s agreement to negotiate implies that the US will impose sanctions – this could lead to the withdrawal of about 1 million barrels of oil per day,” said Ashley Kelty, an analyst at Panmure Liberum.

Iran’s Foreign Ministry said on Sunday that it will hold talks on November 29 on its controversial nuclear program with three European powers.

The markets are also expected to see movements this week ahead of the December 1 OPEC+ meeting, where the group may decide to stick to significant oil production cuts for longer due to weak demand.

“The OPEC+ summit on December 1 will further delay the start of the planned production increase until February. Delaying the start to Q2 or later is another possibility that would add further support,” said Tim Evans, independent energy analyst.

Investors also focused on the growing demand for oil in China.

China’s crude oil imports resumed in November as low prices led to a buildup in demand. According to knowledgeable sources, China’s oil imports are likely to increase further due to an additional import quota of at least 5.84 million metric tons (116,800 bpd) issued to independent refiners for cargoes arriving next year.

Oil prices up 4% on escalating conflict in Ukraine – ReutersNov 22 2024, 03:31 PM • 15036 views