Oil prices drop to seven-month low: Reason explained
Illustrative photo (Getty Images)
Oil prices have dropped to a seven-month low due to rising tensions in the Middle East, according to Bloomberg.
According to the report, Brent crude fell to $76 per barrel, marking its lowest level since early January, while West Texas Intermediate dropped below $73.
The global stock market also experienced a significant downturn on Monday, fueled by concerns over economic prospects.
"Still, the market is bracing for a possible attack from Iran and regional militias against Israel in retaliation for assassinations of Hezbollah and Hamas officials," the report states.
Oil has marked four consecutive weeks of declines amid signs of unstable demand in the US and China.
"While there are growing demand concerns, geopolitical risks continue to hang over the oil market," said Warren Patterson, Head of Commodities Strategy at ING Groep NV in Singapore.
He added that the escalation in the Middle East could lead to short-term volatility.
Global oil situation
Recently, we reported that last month, Russian oil exports from major western ports fell to their lowest level in nearly 20 months, with the most noticeable drop in shipments to China.
Meanwhile, Europe’s share of Russian oil exports has plummeted tenfold to approximately 4-5%.
Previous Western sanctions have led to half of Russia's oil and oil product exports in 2023 heading to China.
