Oil prices fall under pressure from possible talks with Iran
January Brent crude futures fell by 11.5% to $98.3/barrel over the past 7 days (-2.8% over the month) amid the absence of military escalation against Iran, although they remain under pressure from uncertainty with Trump's further decisions regarding Iran and limited supplies from the Russian Federation.
The results of the elections in Israel and the US became the main factors that reduced speculative pressure on oil quotes, as a new US and Israeli war against Iran would only add to the negativity for Prime Minister Netanyahu and President Trump, who has already stated that continuing the blockade of Iran is more beneficial for the US, while a military operation could lead to losses among the military, which he does not want.
Ukraine continues to attack Russian refineries, and in the past 10 days has already damaged about 7 plants, including major fuel suppliers for Moscow and St. Petersburg.
OPEC+ members agreed on Sunday to leave oil production quotas unchanged for December as the organization reinstated the full amount of production cuts (1.65 million barrels per day) introduced in 2023. In October, OPEC countries increased oil production by 930,000 barrels per day to an 8-month high of 22.8 million barrels per day.
On Monday, trading on Asian exchanges began with a 1.2% drop in oil prices to $97/barrel amid new statements by Qatari mediators about Iran's readiness to discuss its nuclear program and a peace agreement with the United States.
Previously, oil prices were supported by high freight rates, but the restoration of ship passage through the Strait of Hormuz, secured by the US military, as well as negotiations with Iran, will contribute to a decrease in freight prices, which will increase pressure on oil quotes.
According to Vortexa, the volume of oil stored on tankers that have been stationary for at least 7 days fell by 11% in the week of October 24-30 to a 3-month low of 78.36 million barrels, indicating a reduction in tanker downtime.
