The price of North Sea Brent crude oil in trading on Thursday (October 29) reached $114.05 per barrel, which is a decrease of $1.27 (1.1%) compared to the previous day. At the same time, WTI crude oil also decreased by $1.51 (1.5%) to $101.27 per barrel.
Oil Market Analysis Following Middle Eastern Developments
This price decrease is due to hopes for negotiations to end the conflicts in the Middle East and reduced concerns about disruptions in oil supply from the region. On Wednesday (October 28), Brent oil prices had increased by 1.3% and WTI oil by 3%.
Forecasts and Impacts on the Oil Market
Giovanni Stano, an analyst at UBS, stated that diplomatic efforts to reduce tensions in the Middle East have had a direct impact on current oil prices. However, concerns about escalating conflicts in the region and potential events following the U.S. midterm elections on November 3 (November 12) have prevented a sharper decline in prices.
Additionally, some forecasts indicate an increase in crude oil and diesel production in Russia, which has affected prices. Analysts at JPMorgan stated in a note that following the attack on the Ryazan refinery in Russia on October 15 (October 23), daily production at the country's refineries has increased by 350,000 barrels to 4 million barrels.
The U.S. Energy Information Administration also reported that in the week ending October 23 (Friday, November 1), energy companies in the country withdrew 1.9 million barrels of crude oil from storage tanks. This is while analysts had predicted that U.S. crude oil inventories would increase by 15,000 barrels during this period. Additionally, U.S. gasoline inventories increased by 3.9 million barrels, while analysts had predicted a decrease of 900,000 barrels.
