On Tuesday, oil prices are declining due to pressure from concerns over escalating trade tensions. Market participants are worried about the impact of increasing friction between the US and EU on economic activity and fuel demand.
According to today's statements by head of the Russian oil company Gazprom Neft Alexander Dyukov, the strategic purchases of crude by the US and China will have a positive effect on the balance of oil supply and demand.
Alexander Novak, Russian Deputy Prime Minister, stated that OPEC+ should continue to increase oil output amid summer growth in consumption.
Despite the risks of possible supply disruptions, China's refineries, the largest buyers of Iranian oil, have not experienced significant challenges so far. One reason behind this resilience is the country's record-high oil reserve levels.
According to the analysts at OilPrice, energy majors in Europe, including Shell, BP and Equinor, are once again focusing on oil and gas. Meanwhile, Shell forecasts oil demand to grow by 3.5 million barrels per day until the early 2030s.
An escalation of tensions between Iran and Israel could lead to a 15–20% increase in Brent oil prices compared to pre-conflict levels. Analysts at Citibank say such an outcome is possible if Iranian exports of crude are reduced by 1.1 million barrels per day.
According to Goldman Sachs analysts, Brent crude prices have climbed to $76–77 per barrel, driven in part by heightened geopolitical tensions. The bank estimates the current fuel risk premium to be around $10 per barrel.
US oil inventories fell by nearly 11.5 million barrels last week, the biggest weekly drop in over a year, according to data from the US Energy Information Administration (EIA). Analysts polled by Reuters had expected a much more moderate decline.
According to vessel-tracking firm TankerTrackers.com, the country has shipped 2.33 million barrels of crude per day starting June 13. Since last Friday, Iran's average oil exports have surged 44% compared to the 12 months through June 12.
A decrease of the indicator value may contribute to the rise in quotes of WTI, Brent.
A decrease of the indicator value may contribute to the rise in quotes of WTI, Brent.
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