Oil Prices Stabilize After Sharp Drop, Here's Why
World oil prices are stabilizing after experiencing their biggest drop in months. The American benchmark crude, West Texas Intermediate (WTI), is trading around US$59 per barrel, while Brent is just below US$64. This significant drop occurred after the market weighed on the latest geopolitical news.
The decline occurred as the market reacted to indications of a delay in planned military strikes against Iran by the United States. This news eased investor concerns about the possibility of a major disruption to global oil supplies from the Middle East — a region crucial to global oil production.
News of the shift in plans came after reports that tensions between the US and Iran had eased somewhat, causing investors to discount the risk of a major conflict that could disrupt oil shipping routes like the Strait of Hormuz. This caused oil prices, which had previously surged, to fall again.
Oil prices are expected to end this week with little change, despite having previously surged sharply since early January due to concerns that the US would target major oil producers like Iran. Furthermore, production issues from Venezuela and disruptions to exports from the Black Sea also pushed prices higher.
However, the overall market is now in a cautious state. Analysts say geopolitical tensions could still trigger price fluctuations, but major concerns about supply disruptions have now eased somewhat. (az)
Source: Newsmaker.id
