๐๐ฟ๐๐ฑ๐ฒ ๐ข๐ถ๐น ๐ฆ๐๐ฎ๐๐ ๐จ๐ป๐ฑ๐ฒ๐ฟ $๐ญ๐ฌ๐ฌ ๐๐บ๐ถ๐ฑ ๐๐ผ๐ฟ๐บ๐๐ ๐๐ถ๐๐ฟ๐๐ฝ๐๐ถ๐ผ๐ป
Oil prices remain below $100 per barrel more than three months after the Strait of Hormuz tightened. The disruption removed over 10 million barrels of daily Middle Eastern supply from the market. Analysts had warned prices would reach $200 per barrel. Crude sits near $96.
President Donald Trump said on Friday prices reached $96 rather than the $300 some expected. After the US and Israel launched joint strikes on Iran, the country restricted access to the Strait of Hormuz. The passage carries 20% of global energy supplies. Prices jumped past $125 from $70 earlier this year.
Several factors have kept prices from climbing higher:
- Saudi Arabia redirected crude through its East-West pipeline to the Red Sea
- The United Arab Emirates shifted flows through pipelines to Fujairah outside the Gulf
- Daily ship transits through the strait fell to two or three vessels from nearly 100 before the conflict
- A US Central Command official told Bloomberg almost 1,000 commercial vessels crossed the waterway during the past two months
China also pulled back on imports. Inbound shipments dropped by nearly 40% in May compared with last year's average, according to Vortexa Ltd. The country stopped expanding its strategic reserves. Increased coal use in chemical production and rising electric vehicle sales cut oil demand. Chinese refinery output reached about 13 million barrels per day in May and June, down from 14.8 million last year, per Kpler and Energy Aspects Ltd.
The United States increased exports. American crude and fuel shipments in May rose more than 2 million barrels per day above last year's average. The US pledged to release 172 million barrels from its Strategic Petroleum Reserve. Almost half went to buyers overseas, including Europe.
Market watchers expect a diplomatic resolution remains possible. Open interest in Brent crude futures dropped to its lowest level since August. Traders have avoided large bullish bets.
Source: The Times of India