Geopolitical escalation pushes oil prices to rise again
As the United States returned from the Labor Day holiday, global oil markets experienced a wave of ascent, as geopolitical concerns overshadowed fundamental factors and pushed prices higher.
Price performance in the market
Oil futures recorded a noticeable rise in the first trading after the holiday, as WTI jumped by 1.2% to reach USD 64.75 per barrel, while Brent crude rose by 0.2% to reach USD 68.26 per barrel.
Attacks on Russian infrastructure
The main impetus for this rise was reports related to the escalation of Ukrainian attacks on Russian oil and energy infrastructure.
These attacks led to a sharp reduction in Russian refining capacities, raising market fears of a shrinking global supply of oil and its derivatives.
Basic factors under pressure
Despite this rise, analyzes indicate that the fundamentals for oil are still rather fragile, as global demand is still under the influence of slowing economic growth in some major countries.
However, the geopolitical factor is currently dominating the market trends.
On the other hand, India continues to be a major player in the current oil landscape.
Despite the fact that the United States has imposed strict tariffs on New Delhi of up to 25% on its purchases of Russian oil, Indian refiners continue to buy Russian oil at discounted prices.
Indian Prime Minister Narendra Modi seems unwilling to bow to US pressure, prompting Russia to lower its oil prices to maintain one of its largest customers in Asia.
Future forecast: the upcoming OPEC meeting
Most analysts and traders expect the OPEC alliance to maintain current production levels at its meeting scheduled for the end of next week, as the group seeks to maintain market stability and price balance.
