By The Rio Times | Created at 2025-01-15 21:53:59 | Updated at 2025-01-31 04:11:42
2 weeks ago
The oil market witnessed a significant upturn, with prices climbing back to the $80 per barrel mark. This surge occurred despite the announcement of a ceasefire between Israel and Hamas in the Gaza Strip.
The rise in oil prices was primarily driven by OPEC’s forecast of increased oil demand by 2026 and a decline in U.S. oil inventories. Brent crude, the international benchmark, saw its most active contracts for March delivery close at $82.03 per barrel.
This represented a 2.64% increase on the Intercontinental Exchange in London. Similarly, West Texas Intermediate (WTI) crude futures for February delivery rose by 3.06% to $78.71 per barrel on the New York Mercantile Exchange.
The Organization of the Petroleum Exporting Countries (OPEC) projected that oil demand would grow by 1.43 million barrels per day in 2026. This forecast, similar to the expected growth of 1.45 million bpd for the current year, was OPEC’s first prediction for 2026.
It appeared in the organization’s monthly report. Deutsche Bank analysts suggested that Brent crude prices could potentially reach $87 to $90 per barrel.
Oil Prices Surge Nearly 3% Despite Israel-Hamas Ceasefire. (Photo Internet reproduction)Oil Market Dynamics
This projection is based on the possibility of a 1 million barrel per day disruption in Russian oil production between the second and fourth quarters. In the United States, oil inventories decreased by 1.962 million barrels, according to the Department of Energy.
This decline exceeded analysts’ expectations of a 1.1 million barrel drop, as reported by The Wall Street Journal. The Israel-Hamas ceasefire agreement, mediated by Qatar, is set to take effect on Sunday.
Qatar’s Prime Minister, Sheikh Mohammed bin Abdulrahman Al Thani, announced this development during a press conference in Doha. Despite these geopolitical developments, the oil market remained bullish.
The combination of OPEC’s demand forecast, U.S. inventory data, and ongoing global economic factors continued to support higher oil prices. This trend highlights the complex interplay of supply, demand, and geopolitical factors in the global oil market.
