Oil Price Rally Reverses Despite Tightening Market Fundamentals
Fears of a spillover in the conflict between Israel and Hamas,
which could embroil Iran and its allies in the region, have offered considerable support to oil prices.
Global oil supply has continued tightening despite record
production by U.S. shale.
Commodity analysts at Standard Chartered have predicted a further
120 mb reduction in global inventories in Q4.
The oil price rally has failed to gain any kind of momentum three
weeks after tensions in the Middle East escalated despite market
fundamentals strengthening. Brent crude for December delivery was down
1.8% to trade at $88.49 per barrel at 1400 hrs ET in Thursday's
intraday session while the December WTI contract fell by a similar
margin to change hands at $83.88 per barrel. Brent has now declined
7.0% over the past week while WTI is down 4.8% over the timeframe as
worries about the global economy and energy demand weighed on
sentiment.
Oil prices have been a rollercoaster over the past couple of months as
negative catalysts frequently outshine the positive ones and
vice-versa. In recent times, fears of a spillover in the conflict
between Israel and Hamas, which could embroil Iran and its allies in
the region, have offered considerable support to oil prices. However,
the U.S. and other countries have been urging Israel to delay a full
invasion of Gaza, which the Middle East nation has so far complied
with.
https://oilprice.com/Energy/Crude-Oil/Oil-Price-Rally-Reverses-Despite-Tightening-Market-Fundamentals.html
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