The price of Brent oil reached its highest level on Friday, hitting $116.08 per barrel. This price increase is due to growing concerns about the security of energy transit routes in the Strait of Hormuz, which is considered one of the most important oil transit routes in the world.
Oil Market Developments
On this day, the price of Brent oil futures for delivery in December increased by $1.20 to $116.08. Additionally, the more actively traded Brent oil contract for January delivery rose by $1.39, trading at $112.19. Meanwhile, West Texas Intermediate (WTI) crude oil also saw a price increase of $1.37, reaching $103.37 per barrel.
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Factors Influencing Oil Prices
Analyses show that Brent oil has risen nearly 11% in October, while West Texas Intermediate has increased by about 14%. The main factors driving this upward trend are heightened concerns about the security of the Strait of Hormuz and the ongoing military conditions around the region. The UK Maritime Trade Operations (UKMTO) reported an incident involving a tanker in the Strait of Hormuz, which has raised concerns about maritime transport security and the potential disruption of oil supplies.
Saul Kavanagh, head of energy research at MST Market, believes that the continuation of military actions around the Strait of Hormuz is one of the main reasons for keeping oil prices at high levels. Ole Hansen, head of commodity strategy at Saxo Bank, also stated in a recent press conference in Singapore that increasing uncertainties have made predicting the future path of oil prices difficult.
According to him, if the conflicts end, crude oil prices are likely to fluctuate in the range of $70 to $90. This is while prior to the onset of the war against Iran, oil prices were in the range of $60 to $70. Overall, the continuation of supply disruptions or increased security uncertainties could keep prices elevated for a longer period.
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