Oil Rises, Geopolitics Heats Up!
Oil prices rose on Monday as investors weighed geopolitical tensions that could disrupt supplies, particularly from the Middle East. Meanwhile, the Russia-Ukraine peace talks still faced significant obstacles.
At 02:36 GMT, Brent rose 56 cents, or 0.92%, to $61.20 per barrel, while WTI rose 51 cents, or 0.9%, to $57.25 per barrel. This rise came after both benchmarks fell more than 2% on Friday.
Friday's decline was driven by market concerns about a potential global supply surplus and hopes that a peace deal could be reached in Ukraine, ahead of weekend talks between Ukrainian President Volodymyr Zelenskiy and U.S. President Donald Trump.
According to analyst Yang An of Haitong Futures, the main reason oil prices rose again was that geopolitical tensions remained high. He highlighted that Russia and Ukraine continued to attack each other's energy infrastructure over the weekend, leading the market to re-factor in the risk of supply disruptions.
Yang also added that the Middle East has recently become "unsettled," following Saudi airstrikes in Yemen and Iran's declaration that its country is in a "full-scale war" with the US, Europe, and Israel. This situation has sparked renewed concerns about potential oil supply disruptions.
From a diplomatic perspective, Trump said on Sunday that he and Zelenskiy were "getting close, maybe very close" to a deal to end the war in Ukraine. However, Trump said it would only be known "in a few weeks" whether the negotiations would be successful, as crucial issues remain unresolved.
IG analyst Tony Sycamore believes there has been no breakthrough and major obstacles remain, particularly over control of the Donbas region. He also estimates that WTI could potentially move in the $55-$60 range, while the market monitors US enforcement action against Venezuelan oil shipments and the impact of US military strikes on ISIS targets in Nigeria—a country that produces around 1.5 million barrels per day. (asd)
Source: Newsmaker.id
