Supervisor Elham AbolFateh
Editor in Chief Mohamed Wadie

Oil Prices Rise as Concerns Increase over Regional Tensions

Tue 30 Jan 2024 | 08:30 PM
Oil barrels (File Photo)
Oil barrels (File Photo)
Taarek Refaat

Oil prices rose on Tuesday, driven by escalating geopolitical tensions in the Middle East.

Brent crude futures rose by 0.33% to reach $82.67 per barrel, West Texas Intermediate (WTI) rose 0.44% to $77.12 per barrel.

Latest Prices

WTI CRUDE            $77.91 +1.47%

BRENT CRUDE      $83.10 +0.85%

MURBAN CRUDE  $82.50  +0.32%

NATURAL GAS       $2.069 +0.73%

The worsening real estate crisis in China, especially after the liquidation of the China Evergrande Group, has raised concerns about demand for crude from the world's largest oil consumer. In addition, oil prices trading above the $80 per barrel threshold now reflects a renewed geopolitical risk premium.

Analysts point out that if tensions in the Middle East continue without a strong response from the United States, this premium could fade within a week or two. However, potential US interventions could keep oil prices in a range between $80 and $100 per barrel.

As the Federal Reserve's two-day meeting begins, investors are awaiting the decision on interest rates. Policymakers are expected to keep interest rates steady, but the possibility of a change in the Federal Reserve's tendency to raise interest rates could positively impact oil prices. Low interest rates are seen as supportive of oil prices and could contribute to increased demand.

Market expectations, according to a Reuters poll, indicate a decline in crude oil inventories and US production and an increase in gasoline inventories. The American Petroleum Institute will release US inventory data today, followed by the Energy Information Administration report on Wednesday. These data releases, along with geopolitical developments, will continue to shape market sentiment and influence oil prices.