Oil prices continue to decline, with Brent crude at $74.31 per barrel.
1. Decline in oil prices: main reasons
A. Trump's statements on the Russian-Ukrainian conflict:
- Impact of statements: U.S. President Donald Trump's remarks about the possibility of the Russian-Ukrainian conflict ending "soon" raised expectations of potential sanctions being lifted on Russia.
- Consequences of lifting sanctions: If sanctions are lifted, Russian oil supplies may fully return to the global market, increasing supply and putting downward pressure on prices.
B. Sanctions on Iran:
- Imposing new sanctions: Sanctions on Iran may reduce its oil exports, but the market seems to be ignoring this factor currently due to focus on increased supply from other sources (such as Russia and Iraqi Kurdistan).
C. Resumption of oil exports from Iraqi Kurdistan:
- Supply quantity: Oil exports from Iraqi Kurdistan are estimated at about 185,000 barrels per day, a significant volume that could affect market balance.
- Timing: Resuming these exports immediately after an agreement with Turkey increases the available supply in the market, putting pressure on prices.
2. Analysis of benchmark oil prices:
A. Brent crude:
- Current price: April Brent crude futures fell to $74.31 per barrel, down 0.63%.
- Explanation: This decline reflects investors' concerns about increased supply due to the factors mentioned above.
B) West Texas Intermediate (WTI):
- Current price: West Texas Intermediate futures fell to $70.28 per barrel, down 0.59%.
- Explanation: WTI crude is more affected by local events in North America, including tariffs on Canadian and Mexican goods.
3. Impact of tariffs on demand:
- Tariffs: Trump's confirmation of imposing tariffs on Canadian and Mexican goods may reduce economic activity in the region.
- Impact on demand: A slowdown in economic activity may lead to a decrease in fuel demand, putting pressure on oil prices.
4. Global demand forecasts:
- Uncertainty in China: China, as one of the largest oil consumers in the world, faces economic challenges that may affect its oil demand.
- Impact on prices: If economic growth in China slows, oil demand may decrease further, adding additional pressure on prices.
5. Future outlook:
- Short-term downward pressures: In the coming weeks, oil prices are expected to remain under pressure due to increased supply (from Russia and Iraqi Kurdistan) and potential weak demand (due to tariffs and slowing growth in China).
- Potential upward factors: If sanctions on Iran continue or if other geopolitical disruptions occur, prices may rise again.
6. Summary:
- Supply: Increased supply from Russia and Iraqi Kurdistan is the main factor behind the current decline in oil prices.
- Demand: Uncertainty about demand, especially from China, adds additional downward pressure.
- Geopolitics: Geopolitical developments, such as Trump's statements and sanctions on Iran, will remain a key factor in determining price trends.
Advice for investors:
- Ongoing monitoring: Investors should monitor geopolitical developments, especially regarding the Russian-Ukrainian conflict and sanctions on Iran.
- Risk management: Due to significant volatility in oil markets, investors should use risk management tools such as stop-loss orders.
- Taking advantage of opportunities: Sharp declines in prices may provide good buying opportunities for long-term investors.