Oil markets kicked off the new year in a downbeat mood, with Wall Street analysts almost unanimously predicting a huge oversupply in 2025 even if OPEC+ did not add a single barrel back into the market. Well, it’s six months on, and oil markets have continued to defy these bearish expectations.
Oil markets are now refocusing on OPEC+ as the Iran-Israel ceasefire continues to hold, with the cartel’s meeting this weekend likely to be the next big market mover.
Momentary price spikes aside, the recent conflict and now uneasy ceasefire between Israel and Iran has done little to alter the trajectory of global oil markets, according to a new analysis by S&P Global Commodity Insights.
Oil market concerns over Middle East hostilities became almost exclusively focused over the past week on the Strait of Hormuz and the potential for short-term disruption. That’s what analysts at Standard Chartered Bank, including the company’s commodities research head Paul Horsnell, think, a new report sent to Rigzone by the Standard Chartered Bank team on […]
That’s what Bjarne Schieldrop, Chief Commodities Analyst at Skandinaviska Enskilda Banken AB (SEB), said in an oil report sent to Rigzone by the SEB team on Monday. In the report, Schieldrop highlighted that Brent crossed the $80 per barrel line this morning but noted that it “quickly fell back, assigning limited probability for Iran choosing to close the Strait of Hormuz”.
Oil swung in a turbulent session amid speculation the U.S. may join the Middle East conflict, with traders focused on flows through the region’s vital shipping chokepoint.
As the Israel-Iran conflict shows no signs of abating, oil supply from the Middle East could become vulnerable if the two sides decide to attack vital energy infrastructure in the region, RBC Capital Markets said, warning that energy, and oil in particular, are now “clearly in the crosshairs.”
The prospect of ending U.S. sanctions against Iran looked rather distant just a couple of weeks ago, but now President Trump is signaling that he wants to make a deal and is serious about it. Lifting the sanctions would have significant implications for the oil market—and some unintended consequences.
Low inventories reported today by the Energy Information Administration (EIA) did nothing to staunch the bleeding, with WTI getting gutted nearly 4% on the day, and Saudi rumors throwing another spanner in the works, while new U.S. economic data suggests more pain is in store for the sector.
“The supply side is also placing additional pressure on prices. Data from the American Petroleum Institute showed an unexpected increase of 3.8 million barrels in U.S. crude inventories, intensifying market fears of a structural supply surplus,” Gule pointed out.