Rally Eases, Oil Now Sensitive to Geopolitical Headlines
Oil prices moved slightly on Friday, following the sharp rally in the previous session. Brent held around US$62.00/barrel, while WTI hovered around US$57.72/barrel, reflecting a market that was beginning to "lock in" positions while awaiting the next direction.
Although the movements were small, sentiment remained fragile as investors' primary focus shifted from demand to supply risks. The biggest concerns stemmed from Russian export routes and the escalating situation in Iran.
From the Russian side, reports of drone attacks on tankers bound for Russian territory in the Black Sea re-raised the issue of potential distribution disruptions. This situation prompted the market to quickly establish a "risk premium" even though no major disruptions had been confirmed.
In Iran, widespread protests have added to market concerns about the smooth running of energy production and logistics. Reports of a nationwide internet outage also reinforced the unstable domestic situation.
Supply concerns also stem from Iraq. The local government approved the takeover of the giant West Qurna 2 field to prevent production disruptions related to the uncertainty surrounding sanctions against Russia (Lukoil).
Meanwhile, the market is still monitoring Venezuela's dynamics after the US pushed for tighter controls on the country's oil sales and revenues, as well as increased competition for exports. This combination of geopolitical factors tends to keep prices from falling further, although the issue of a global supply surplus remains a brake on further increases.
Source: Newsmaker.id
