Brent prices are currently trading at around $94 per barrel, marking the strongest weekly performance since mid-July. Over the past seven days, oil has gained approximately 7%, driven primarily by a sudden escalation of geopolitical jitters in the Middle East. Washington has signaled it will not return to the negotiating table until attacks on commercial shipping in the Strait of Hormuz cease. So, where does this leave us? A combination of persistently high supply disruption risks and a rising geopolitical premium on Brent crude is at play.
The energy market was also supported by fresh US oil inventory statistics. The week that ended August 28 showed commercial fuel stockpiles dropped by 4.5 million barrels, far exceeding the 1.1 million decline that traders had anticipated. At the same time, exports increased by 691,000 barrels per day (bpd), reaching a total of 4.5 million. Refinery utilization hit 98%, the highest level since August 2018. What does this tell us? The data points to sustained strong demand from the processing sector and underscores mounting tensions in the global supply‑demand balance.
The upcoming OPEC+ meeting is another tailwind for Brent prices. According to Reuters, the group is highly likely to keep October’s quotas unchanged. In the meantime, actual production levels continue to lag behind the alliance’s targets due to disruptions in Iran, Russia, and Kazakhstan.
The overall recommendation is to buy Brent crude at the current price of $94, aiming for $100 per barrel within a couple of weeks. Set a Stop Loss order at $92.50 to mitigate the risk of unfavorable market movements.
This content is for informational purposes only and is not intended to be investing advice.
