The escalation of tensions between Russia and Ukraine e Putin’s threats to the West they once again inflate the price of crude oil, bringing prices on international markets back above 70 dollars a barreldespite a series of bearish factors that had caused prices to fall in previous months, not least the slowdown in Chinese demand.
The future on Brent of the North Sea jumped a dollar and a half yesterday, gaining about 2% at 74.27 dollars a barrela price on which it is holding this morning when the European markets reopen. At the same time, the US crude oil futures contract West Texas Intermediateincreased by approximately 2%, settling at 70.10 dollars a barrel.
Putin’s threats
The Russian President Vladimir Putin announced yesterday that it had launched a hypersonic ballistic missile attack medium range against a Ukrainian military facility, warning that it will target the military facilities of every Western country that supplies Kiev with weapons against Russia. The Russian President also warned that the conflict is becoming globalafter having also threatened one in recent days nuclear drift.
“On the oil side, the risk is that Ukraine will target Russian energy infrastructure, while the other risk is uncertainty over how Russia will respond to these attacks,” analysts at ING said in a daily note, adding that, on the other hand, “Iran’s commitment to stop uranium stockpiling partially counteracts geopolitical risk, potentially reducing some of the Iran-related supply risks before the president-elect takes office Trump.”
Crude oil inventories still high
It weighs on the market the increase in inventories of crude oil detected on Wednesday byEIAwhich announced growth in US stocks of 545 thousand barrels to 430.3 million in the week ending November 15, exceeding analysts’ expectations. The increase was mainly driven by gasoline stocks, while those of distillates, more used in heating, recorded a greater decline than expected.
Surplus demand expected in 2025
China’s economy is clearly slowing down and perspectives on demand of crude oil they aren’t the bestDespite Beijing announced new measures trade stimulusincluding crude oil imports. However, concerns remain about the policy that President-elect Donald Trump will develop with the related risk of reinstating duties and related retaliation.
Last week, the IEA confirmed that the oil market could record a surplus of over 1 million of barrels next year, largely due to weakening demand from China. The IEA believes that the increase in oil demand this year will reach only 920 thousand barrels, less than half the growth rate of last year, while next year, the increase will not be much higher at about 990 thousand barrels per day.
The doubts of OPEC Plus
OPEC+, meanwhile, it could postpone the production increase further scheduled for next year December 1stdue to weaker than expected demand. The expanded OPEC group counts Saudi Arabia and Russia among its top producers and supplies around half of the oil globally. However, the new political line of Donald Trump they could increase the supply of crude oil and this could put pressure on OPEC to follow the same strategy.
