Oil, a major energy source and a key indicator of the global economy, is currently experiencing a period of high volatility. After several weeks of uncertainty linked to the Middle East conflict, the oil market is calming down with the disappearance of the geopolitical risk premium.
Latest Developments
- Sharp decline in Brent prices: The price per barrel fell from nearly USD 80 last week to around USD 67-68, marking the largest weekly drop since March 2023.
- Easing of the Israel-Iran conflict: The ceasefire and the absence of significant disruptions in global supply have removed the geopolitical risk premium that had been supporting prices.
- End-of-week rebound: A slight recovery in prices is explained by declining crude oil and fuel inventories in the United States, combined with increased demand and refining activity.
Analyst Recommendations
- Caution and vigilance: Analysts recommend a cautious stance, emphasizing that the market remains sensitive to geopolitical events that could quickly reverse the current trend.
- Monitoring supply and demand: Close attention is advised on U.S. inventory data as well as global demand developments, especially in Asia, which remains a key factor for price stability.
- Flexible strategies: Investors are encouraged to maintain flexibility, ready to adjust positions according to rapid fluctuations in geopolitical tensions and economic indicators.
In summary, after a significant drop due to easing Middle East tensions, the oil market shows signs of stabilization. However, the situation remains fragile, justifying prudent risk management in an ongoing uncertain environment.