Middle East Geopoliticals, Oil Prices Record Weekly Declines

Illustration of oil refineries (ANTARA)

JAKARTA - Oil prices rose by about 1% on Friday amid geopolitical tensions in the Middle East, but suffered weekly losses due to a projected growth of pessimistic global demand for global oil from the International Energy Agency, as well as concerns about a slowdown in the rise in US (US) interest rates. Brent crude futures up 71 cents to the level of US$ 90.45 per barrel. For crude futures West Texas US Intermediate, it increased 64 cents to the level of US$ 85.66. This week, Brent prices experienced a 0.8% drop, while WTI fell more than 1%. "The main focus of the market is whether Iran will retaliate against Israel," said President Lipow Oil Associates Andrew Lipow. There is a concern that supply disruption related to events in the Middle East could drive price increases. Problems related to supply chains remain a major risk as Iran continues to spread its threats to close the Suez Canal.

The International Energy Agency cut its projection of growing world oil demand in 2024 to 1.2 million barrels per day (bpd). Meanwhile, OPEC projects that world oil demand will increase by 2.25 million bpd in 2024. "For now, the market is generally more inclined to projected growth in OPEC demand by 2.2 million barrels per day compared to the projected International Energy Agency which decreased by 1.2 million barrels per day," said Ole Hansen of Saxo Bank.