A political standoff in Libya risks once more paralyzing the north African country’s lucrative oil sector.
But the frequency of its power tussles and crude disruptions have left long-term oil price support into question.
Oil prices rallied on Monday on the Libyan reports, but had already surrendered much of these gains during the Tuesday session.
Crude oil prices ticked higher earlier today, after posting two daily losses, as the shutdown of oil fields in Libya took precedence over demand worry.
Oil prices rose sharply after the American Petroleum Institute reported a significant drop in US oil inventories.
Lower-than-expected producer price inflation boosted hopes for a Federal Reserve rate cut.
Oil prices had been under pressure before the API report, with the IEA and OPEC warning of slowing demand next year.
Oil prices extended gains on Thursday after the killing of a Hamas leader in Iran raised the threat of a wider Middle East conflict and concern over its impact on oil.
Crude oil prices spiked after Israel assassinated Hamas’s political leader on Iranian soil, leading to threats of retaliation from Tehran.
The ongoing conflict in the Middle East, combined with record US oil demand, has created a bullish environment for oil prices.
Early on Thursday morning, WTI was trading around $78.50 while Brent had climbed above $81.
Crude oil prices continued to fall on Tuesday, with WTI trading just above $75 and Brent slipping below $80.
Concerns about Chinese demand continue to drag prices lower, with expectations of China’s manufacturing activity shrinking for a third month in a row.
In some bullish news, Venezuela’s election results could lead to tighter US sanctions and lower oil supply.
Oil prices were little changed on Monday after Joe Biden announced he would not seek a second term as U.S. president, while investors watched for more signs that U.S. interest rates could be cut as early as September.
Oil prices fell in Friday trade in Asia and were poised for a second straight weekly decline as concerns about demand more than offset falling U.S. crude inventories and rising odds of a September interest rate cut from the Fed.
A stronger dollar tends to lower oil prices as buyers using other currencies have to pay more for their dollar-denominated crude
The U.S. Energy Information Administration (EIA) raised its Brent oil price forecasts for 2024 and 2025 in its latest short term energy outlook (STEO), which was released this week