Geopolitical crisis led to destruct global oil pricing after slow trade in Asia

by Psu Connect
Date: 12-02-24

The escalation broadened by the Israel-Palestinian conflict across the region and potential oil supply disruption in the Middle East pushed prices up by about 6 percent last week.

Geopolitical crisis led to destruct global oil pricing after slow trade in Asia

New Delhi: Oil prices get to slow down in early Asian trade as a concluding escalation after a series of strikes in southern Gaza, that affected the supply ratio concerns within the Middle East. The geopolitical turmoil has instigated the global crude supply and its import as well.

The escalation broadened by the Israel-Palestinian conflict across the region and potential oil supply disruption in the Middle East pushed prices up by about 6 percent last week. Brent crude futures traded down 29 cents, or 0.4% lower at $81.90 per barrel, while U.S. West Texas Intermediate crude futures were down 28 cents, or 0.4% at $76.56 per barrel.

Logistics disruptions in the Red Sea remained front and center of investor concerns. The United Kingdom Maritime Trade Operations [UKMTO] had received a report of a ship being attacked by two missiles south of Yemen’s Al Mukha. The Houthi militants backed by Iran have relentlessly dispatched drones and fired missiles at commercial ships as a subsequent response to Israel’s military action in Gaza. The conflict has disrupted global shipping, leading several companies to halt Red Sea journeys and opt for a longer and more expensive route around Africa.

US energy firms increased oil and natural gas prices to their highest since mid-December, significantly highlighting an increase in output. Domestic production returned last week to a record 13.3 million barrels per day. The other dominating factor influencing the global oil market is the US Fed Reserve's unchanged interest rates and its next half year’s stability chorus.

Trading in Asia hours has been slow and mild due to closing sessions of holidays in China, Hongkong, Japan, South Korea, Singapore, Taiwan, Vietnam, and Malaysia.

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