Oil prices continue to fall under the pressure of increased reserves in the US and reduced risks of escalation in the Middle East

During the week, global oil prices fell by 2.6% amid reduced risks of escalation in the Middle East, caused by the death of Iran's president, who was nicknamed "the butcher of Tehran" and was supposed to replace 85-year-old Ayatollah Khamenei. A new president will be elected on June 28, and he will not change the course of the country, but the intensification of the internal struggle of the clans will at least temporarily distract them from the escalation in the world markets.

In the near future, Israel plans to conduct a major military operation in the southern part of the Gaza Strip - in the city of Rafah, despite warnings from the US President's administration.

In yesterday's report of the international energy agency EIA, crude oil stocks in the US increased by 1.83 million barrels, while traders expected their decrease by 2 million barrels. Gasoline stocks decreased by 945,000 barrels against expectations of a decrease of 1.375 million barrels. Cushing crude inventories, the benchmark for WTI futures, rose 1.33 million barrels to a 10-month high. Prices are also pressured by the decision of the US President's Administration to allocate 1 million barrels of gasoline from reserves before Independence Day to increase supply and lower prices at gas stations.

July Brent oil futures on the ICE Futures exchange in London yesterday fell by another 1.2% to $81.8/barrel (-2.6% since the beginning of the week, -6.8% for the month).

The pressure on the prices is increased by the news from the Russian Federation about the increase in oil production and export volumes. During May 1-15, oil refining in the country increased by 4% compared to the corresponding period in April to 5.45 million barrels/day, as refineries resumed work after attacks by Ukrainian UAVs. Oil exports for May 13-19 increased compared to the previous week by 4.3% to 3.39 million barrels/day.

During the week, Urals oil prices fell by only 1.6% to $68.5/barrel (-15.8% for the month), but may fall below the sanctioned level of $60/barrel, which will reduce Russian revenues and the ability to continue the war

It is expected that Brent oil prices may drop to $78-80/barrel, which will lead to lower prices for vegetable oils and oilseeds used in biodiesel production.