Oil Prices Decline Amid Weak Demand Outlook
Brent crude futures dipped by 3 cents, settling at $74.22 per barrel, while US West Texas Intermediate (WTI) fell by 19 cents, or 0.3%, to $70.39. This marks the second consecutive day that both benchmarks have reached their lowest levels since October 2.
Geopolitical Factors and Supply Concerns
The decline in crude prices was influenced by a weak demand outlook and reports suggesting that Israel would refrain from attacking Iran’s nuclear and oil facilities, alleviating fears of potential supply disruptions. Iran, a key OPEC member, is projected to increase its exports in 2024, despite ongoing tensions in the region.
OPEC Adjusts Demand Forecasts
OPEC and the International Energy Agency have revised their 2024 global oil demand growth forecasts downwards, primarily due to diminishing expectations from China. Meanwhile, positive economic indicators from the US and Europe have provided some support to oil prices.
Upcoming US Oil Storage Data
Attention now turns to US oil storage data, with the American Petroleum Institute and the Energy Information Administration set to release their reports. Analysts anticipate an addition of approximately 1.8 million barrels to US crude oil storage, marking a shift in stockpiling trends.
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Summary at glance
Brent and WTI crude prices fell to their lowest levels since early October, with Brent at $74.22 and WTI at $70.39. The decline was driven by a weak demand outlook and reports of reduced tensions between Israel and Iran. OPEC and the International Energy Agency also downgraded their 2024 global oil demand forecasts, particularly due to slowing growth in China. Meanwhile, positive economic signals from the US and Europe helped mitigate the price drop.
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