On Tuesday, Brent oil reached $114.70 per barrel, indicating a decrease of 0.57% compared to the previous day. This price drop comes as the likelihood of reaching an agreement to end the U.S. and Israel's war against Iran has reduced concerns about disruptions in oil supply.
Analysis of the Oil Market Situation
West Texas Intermediate crude oil also reached $100.70 per barrel, reflecting a one-dollar and 1% decrease from the previous day. However, the decline in Brent and West Texas Intermediate prices remains limited. The outlook for peace in the Middle East still appears fragile, and new attacks by Ansar Allah on Saudi Arabia, one of the world's major oil producers, have increased concerns.
Maritime Security Situation in the Strait of Hormuz
According to data collected by a Washington-based think tank, October 2023 has been recognized as the worst month in terms of the number of attacks on commercial ships in the Strait of Hormuz and adjacent waterways. This strait, known as the energy crisis hotspot in the Middle East, accounted for about one-fifth of global energy supply before the onset of conflicts in February.
Last week, following a wave of Iranian attacks on tankers around the Strait of Hormuz, Brent oil prices surged to over $117 per barrel, the highest level since April. These developments indicate the direct impact of regional insecurity on global oil prices.
Increase in Diesel Production at Russian Refineries
In another development, two industrial sources close to the matter announced that Russian refineries will increase diesel production in October. This decision was made following an agreement between the Kremlin and the U.S. regarding supply and export quotas.
Given the recent developments in the Middle East and rising tensions, oil prices are expected to remain influenced by regional security and political conditions. Analysts believe that under the current circumstances, the oil market is highly affected by daily events, and any change in the security situation could impact prices.
Read more: Brent Oil Price Drops to $114 Amid Potential U.S.-Israel Agreement · 6% Drop in Oil Prices Following Diplomatic Moves Regarding Iran
