In a Thursday note, the bank’s commodities team shared a cautious view on oil due to several factors influencing the market, including OPEC’s supply dynamics and non-OPEC production growth.
Oil steadied on Wednesday, supported by OPEC+ cuts and uncertainty over what may happen next in the Middle East conflict, although an outlook for ample supply next year added downward pressure.
Oil prices slid as much as $3 to a near two-week low during Asian trade on Tuesday on the back of a weaker demand outlook and after a media report said Israel is willing not to strike Iranian oil targets, which eased fears of a supply disruption.
Oil prices declined about 2% on Monday, wiping out all of last week’s gains, as OPEC’s lowering of its 2024 and 2025 global oil demand growth view again added to concerns of weak fuel demand with China’s oil imports falling for a fifth month in a row.
That said, for the week, both benchmarks were headed for gains of around 1%, the second straight positive week, with oil markets remaining supported by concerns over an escalation in Israel’s conflicts with both Hamas and Hezbollah.
Oil extended losses on Wednesday as weak demand and rising U.S. inventories countered the risk of supply disruption from conflict in the Middle East and Hurricane Milton in the United States.
Oil prices fell on Monday, after posting their steepest weekly rise in more than a year last week, as oversupply concerns amid softer demand countered the worries over a wider Middle East conflict disrupting exports in the key oil-producing region.
Oil prices rose on Thursday as the prospect of a widening Middle East conflict that could disrupt crude oil flows from the key exporting region overshadowed a stronger global supply outlook.
On Monday, Brent futures ended September down 9%, the third month of declines and largest monthly drop since November 2022. It slumped 17% in the third quarter for its biggest quarterly loss in a year. WTI fell 7% last month and dropped 16% for the quarter.
Oil prices rose for a second consecutive session on Monday, with concerns escalating over potential supply disruptions in the Middle East after Israel stepped up attacks on Palestianian militant group Hamas and Iranian-backed forces in the region.
