Today, Monday, January 30, 2023, the price of a barrel of oil declined globally, giving up its gains at the beginning of trading.
Imminent interest rate hikes by major central banks and signs of stronger Russian exports offset rising tensions in the Middle East over a drone attack in Iran and hopes of a boost in Chinese demand.
Investors expect the Federal Reserve to raise interest rates by 25 basis points on Wednesday, followed the next day by half a point increase from the Bank of England and the European Central Bank, and any deviation from this scenario would be a shock.
The global price of a barrel of oil today
By 09:26 AM GMT (12:26 PM Mecca time), the futures prices for Brent benchmark crude – for delivery in March 2023 – decreased by 0.20%, to reach $ 86.49 per barrel.
The price of US West Texas crude futures – delivery in March 2023 – fell by 0.45%, to $79.32 a barrel, according to data seen by the specialized energy platform.
Oil prices ended trading on Friday, January 27, down by more than 1.5%, due to profit-taking and increased Russian exports despite Western sanctions.
The price of a barrel of oil globally recorded weekly losses, for the first time in 4 weeks; Both crudes (Brent and West Texas Intermediate) fell by 1.1% and 2.4%, respectively.
Oil market conditions
Serena Huang, head of Asia-Pacific analysis at Vortexa, said oil prices “are likely to be affected by potential rate hikes at the next Fed meeting.”
The market was also pressured by indications of Russian supply strength, despite the EU embargo and the G7 price cap over its invasion of Ukraine.
OPEC+ meeting
Besides central bank meetings, Wednesday’s meeting of key ministers from the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, in the alliance known as OPEC+, will also be a focus.
It is unlikely that the meeting of the OPEC + committee, on Wednesday, will lead to an adjustment of oil production policy, despite the expectations of some for a small cut.
“The next wave of price stimulus is setting the stage for significant volatility in the price of a barrel of oil globally this week,” said analyst from PVM, Stephen Brennock.
“However, prices are unlikely to fall below $80, and you will find it difficult to get close to $100,” he added, according to Reuters.
Geopolitical tensions
The price of a barrel of oil rose globally, earlier today, Monday, amid tensions in the Middle East in the wake of a drone attack on a materials and energy laboratory in Iran.
Portfolio manager at Vantage 8, Stefano Grasso, said that although it is not yet clear what is happening in Iran; Any escalation there would likely disrupt the flow of crude oil.
Hopes of an increase in Chinese oil demand in 2023 have fueled; The world’s largest importer of crude oil pledged, over the weekend, to consolidate a recovery in consumption that would support demand.
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