Written by: Basant El-Farmawy
Global oil markets witnessed a noticeable rise in crude prices during trading on Tuesday, as Brent crude traded near its highest levels recorded in five months. This rise comes as a direct result of escalating geopolitical tensions in the Middle East, prompting traders to reassess risk premiums amidst uncertainty regarding the stability of supplies and maritime navigation.
Impact of geopolitical risks on markets
Market analyses indicate that oil prices are currently receiving strong support, as the market reflects a significant risk premium due to the current volatility in geopolitical conditions. These movements follow reports specialized in tracking ship movements, which indicated that at least 18 oil tankers have been subjected to incidents or attacks in the Middle East region over the past two weeks, raising investor concerns regarding the security of supply chains and the safety of vital energy transport waterways.
Anticipating US data and price levels
In terms of trading, the most active standard Brent crude contracts recorded levels near $110.10 per barrel, while the price of the contract for December delivery reached about $109.89 per barrel, achieving a rise of 0.30%. In the same context, Nymex crude for November delivery contracts recorded a similar rise, reaching $103.99 per barrel.
Investor attention is currently directed towards periodic oil inventory data in the United States, as the American Petroleum Institute (API) report is expected to be released today, followed by the official data from the US Energy Information Administration (EIA) tomorrow, Wednesday. These reports are expected to play a pivotal role in determining the path of prices in the coming days, especially in light of the market's continued interaction with global political and economic variables that directly affect the balance of supply and demand.
