empty
27.12.2023 06:27 AM
Oil jumped more than 2% amid attacks on ships in the Red Sea and hopes for a rate cut.

This image is no longer relevant

Key Points:

  • The attack on a container ship in the Red Sea has catalyzed a rise in oil prices.
  • Last week witnessed a 3% increase in oil prices, underscoring the unpredictability and volatility of the market.
  • Limited trading activity due to holiday closures played a role in the current price dynamics.
  • Anticipation of the U.S. Federal Reserve's decisions on interest rate cuts in March 2024 adds further uncertainty to market trends.

On Tuesday, oil prices reached their highest level for the month, increasing by more than 2%. This movement was fueled by concerns about potential disruptions in maritime transport following incidents in the Red Sea, and expectations of interest rate cuts that could stimulate economic growth and fuel demand.

Specific Figures:

  • Brent crude futures jumped by $2, or 2.5%, reaching $81.07 per barrel, continuing a 3.4% rise from the previous session.
  • U.S. West Texas Intermediate crude increased by $2.01, or 2.7%, to $75.57.

These trends, amplified by reduced trading activity during the holidays, added to last week's 3% increase, caused by Houthi attacks on maritime vessels, raising investor concerns, and ongoing violence in the Gaza Strip.

John Kilduff from Again Capital LLC emphasized: "Today's geopolitical tension in the Middle East raises serious concerns about the safety of transporting oil and other goods."

Houthi military actions, including a missile attack on a container ship in the Red Sea and attempts to strike Israel using drones, only intensify this concern.

On the other hand, the increase in oil demand, spurred by the recovery of the global economy post-pandemic, has stimulated buyer interest. Major oil companies such as Exxon Mobil, Chevron Corp, and Occidental Petroleum have made significant investments, totaling $135 billion in 2023. ConocoPhillips has entered into two major deals in the past two years, reflecting growing interest in the oil sector.

Global oil demand over the past two years has increased by approximately 2.3 million barrels per day, reaching 101.7 million barrels. This surge in demand has significantly impacted global reserves and pricing, especially considering the limited production by OPEC and its allies.

Looking Ahead:

Analysts predict that in 2024, global oil prices will remain relatively stable, fluctuating between $70 and $90 per barrel, significantly higher than the average level of $64 per barrel in 2019. This compares with an average price of around $83 per barrel in 2023 and $99 per barrel in 2022.

Thomas Frank,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Skechers' $9B, Indexes Sink, Asia Surges: A Day of Change

Berkshire Hathaway Slips After Buffett Steps Down as CEO U.S. Services Sector Rising in April Skechers Jumps After $9B Privatization Deal Investors Await U.S.-Partner Trade Deals Asian Currencies in Focus

Thomas Frank 07:41 2025-05-06 UTC+2

US Market News Digest for March 17

US stock indexes, including the S&P 500 and Nasdaq, ended the week confidently in positive territory. This was largely due to encouraging developments in trade talks with China and resilient

Ekaterina Kiseleva 13:32 2025-05-05 UTC+2

Europe on pause: What's behind the stock market plunge and Trump's unexpected activity

European stocks fell slightly; STOXX 600 - minus 0.1%, France - minus 0.3% Investors await data on US-China talks, earnings and Fed decision Trump: 100% tariffs on foreign films, Alcatraz

Thomas Frank 11:34 2025-05-05 UTC+2

US Market News Digest for May 2

US equity indices continue to climb despite lingering economic uncertainty. Investor optimism is being driven by expectations of progress in trade talks between the US and China. Nevertheless, ongoing economic

Ekaterina Kiseleva 13:14 2025-05-02 UTC+2

US Market News Digest for May 1

The US stock market weathered notable volatility in April, but a successful rally helped major indices recoup losses. Despite data showing a 0.3% contraction in US GDP for the first

Ekaterina Kiseleva 11:54 2025-05-01 UTC+2

Feast in the Storm: S&P 500 Celebrates Gains as Dollar Drowns and China Weakens

S&P 500 Posts Sixth Straight Day of Gains Oil Falls More Than 1% China Manufacturing Activity Plummets as Trump Tariffs Continue to Squeeze Dollar Set for Worst Month

Thomas Frank 12:09 2025-04-30 UTC+2

US Market News Digest for April 30

US stock indices remain on a positive trajectory, but market pressure has intensified due to a sharp drop in Super Micro shares and the upcoming earnings reports from tech heavyweights

Ekaterina Kiseleva 11:13 2025-04-30 UTC+2

Stock markets regaining optimism. Where to find new entry points

European stocks rose amid hopes of easing trade tensions between the US and China. WTI oil fell by 1.54% to $62.05, while Brent declined by 1.51% to $65.86

12:42 2025-04-29 UTC+2

US Market News Digest for April 29

The S&P 500 and Nasdaq continue to climb, maintaining their upward momentum despite mixed performances across other sectors. Softer rhetoric from the Trump administration and expectations of further tariff relief

Ekaterina Kiseleva 11:59 2025-04-29 UTC+2

Optimism returns to the markets: where to look for new growth points

European stocks rose amid hopes for a reduction in trade tensions between the US and China. WTI oil fell by 1.54% to $62.05, Brent by 1.51% to $65.86

Thomas Frank 10:42 2025-04-29 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.