Mumbai
Brent crude oil prices are expected to remain stable within the range of $75 to $80 per barrel, with potential spikes only occurring if the Middle-East conflict worsens and damages Iranian oil fields. Currently, Brent crude is trading at approximately $74 per barrel, according to a report on Monday.
Market anxiety stems from developments related to the Middle-East conflict. However, unless there are significant attacks on Iranian oil fields, the report suggests that prices will likely continue within the established range. The current fundamental factors do not support higher oil prices.
The report highlights that any disruption to oil supply, particularly due to terrorist attacks or damage to Iranian oil infrastructure, could adversely affect prices. It is also noted that U.S. sanctions on Iran’s petroleum products remain in place and have been tightened, but these regional issues alone do not warrant a rise in oil prices.
Forecasts from OPEC, the International Energy Agency (IEA), and the U.S. Energy Information Administration (EIA) point to an oversupply of oil in the coming year, with supply outpacing demand growth. Additionally, demand for oil from China has weakened significantly over the last three months, particularly for diesel and gasoline, leading to a reduction in Chinese refining activities. This decline in Chinese demand may signal a notable decrease in its contribution to global oil demand growth, according to the report.
