Oil prices are on track for their biggest weekly fall since March 2023, as concerns about supply problems due to the Iran-Israel conflict have reduced. Earlier fears of a shortage had pushed prices up, but those fears are now easing.
As of Friday morning (0637 GMT), Brent crude oil was up slightly by 36 cents at $68.09 per barrel, and US West Texas Intermediate (WTI) rose by 33 cents to $65.57 per barrel. Even with these small gains, both oil types are expected to drop about 12% this week.
The price surge earlier this week came after US attacks on Iranian nuclear sites, which raised worries about global oil supply. But those worries quickly faded after US President Donald Trump announced a ceasefire between Israel and Iran, leading to a big price drop on Tuesday.
Experts say oil supply hasn’t been affected much by the conflict. In fact, there’s too much oil in the market right now. Analysts at Macquarie believe that in 2025, there will be a surplus of about 2.1 million barrels per day. Because of this, they still expect WTI prices to average $67 per barrel in 2025 and $60 in 2026.
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However, there was some positive news for oil prices too. US government data showed a drop in oil and fuel stockpiles, along with higher demand and more refining activity. This suggests oil supplies in the US are getting tighter.
In addition, a Wall Street Journal report said President Trump might announce his pick for the next Federal Reserve chair soon. This raised hopes of interest rate cuts, which could boost oil demand.
Also See: Oil Gains 2% as Iran-Israel Ceasefire, Fed Outlook Ease Market Worries
