On April 5, Brent crude oil reached its highest level since October 2023 due to concerns over the risk of conflict between Israel and Iran. The price of Brent increased by 0.6%, while US crude oil also rose by 0.4% to 86.9 USD per barrel, making them the highest prices in six months. Both Brent and WTI increased by over 4% this week, with Iran announcing its intention to retaliate against Israel after an Iranian general was killed in an attack in Syria, although Israel has not claimed responsibility.
The potential for conflict between Israel and Iran has raised geopolitical risks, which, coupled with potential reductions in Russian oil refinery capacities due to attacks by Ukraine, has influenced oil prices. OPEC+ decided to maintain production policies and pressure member countries to comply with production reduction policies, which could further tighten oil supplies and reduce inventories in the coming quarter.
However, the US employment report for March showed a more vibrant labor market than expected, with 303,000 new jobs created. This increase in oil demand could delay the US Federal Reserve’s decision to reduce interest rates this year. Analysts forecast a global increase in oil demand in the second quarter and note a decrease in the number of drilling rigs in the US, indicating potential future changes in oil and gas output.
