Brent crude oil price reached $114.51 per barrel by 4:26 AM on Monday (October 25), indicating a decrease of $2.21 or 1.89%. This price drop occurred as investors reacted to hopes for reduced tensions in the Middle East. The price of West Texas Intermediate (WTI) crude oil also fell by $2.23 or 2.16%, reaching $101.04 per barrel.
Impact of Conflicts on Oil Market
The prices of both oil benchmarks rose by about $3 during trading on Friday (October 21) due to conflicts in Saudi Arabia and concerns over energy supply. Brent oil experienced a weekly increase of 6%, while U.S. oil saw a weekly rise of 2.3%. Vandana Hari, founder of the oil market analysis firm "Vanda Insights," stated that concerns about the resumption of military conflicts in the Middle East were the main driver of last week's oil price increase, but this calm may be temporary.
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Future Plans of Aramco and Energy Markets
The energy ministers of Saudi Arabia and Singapore announced on Monday that the state-owned oil company Saudi Aramco will begin crude oil storage in Singapore in the second half of 2027. The aim of this move is to strengthen the resilience of the company's supply chain in the region. Priyanka Sachdeva, head of market outlook at "Phillip Nova," noted that supply risks from the Strait of Hormuz remain significant, but the current price drop reflects more of a repositioning of trading positions and risk management rather than a meaningful improvement in the fundamental supply situation.
Fatih Birol, head of the International Energy Agency, also predicted during an industry event in Singapore that energy markets will return to the state before the U.S. and Israeli war against Iran by 2027. These predictions highlight the existing uncertainties in energy markets and their impacts on prices.
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