As of November 22, 2024, crude oil prices have experienced a notable increase due to escalating tensions between Russia and Ukraine. On November 21, Brent crude rose by 2% to $74.23 per barrel, while West Texas Intermediate (WTI) crude increased by 1.96% to $70.10 per barrel. This surge follows Russian President Vladimir Putin's announcement of a hypersonic missile attack on Ukraine, coupled with Ukraine's retaliatory missile strikes on Russian targets, intensifying the ongoing conflict [600863c2].
Despite the recent increase in prices, the market remains sensitive to the overall supply dynamics. The U.S. Energy Information Administration (EIA) reported a rise in crude inventories by 545,000 barrels to 430.3 million barrels as of November 15, 2024 [329c8c2a]. Analysts are expressing concerns that these geopolitical tensions could disrupt Russian oil supplies, which may lead to further fluctuations in global oil prices [600863c2].
In light of these developments, OPEC+ is considering delaying planned output increases at their upcoming meeting on December 1, 2024, due to weak global demand [600863c2]. Earlier in the week, on November 20, Brent crude had fallen to $72.85 per barrel, reflecting the market's volatility amidst the geopolitical backdrop [329c8c2a].
Additionally, the International Energy Agency (IEA) has projected that global oil supply will exceed demand by over 1 million barrels per day by 2025, primarily driven by a contraction in Chinese oil consumption [e809efad]. The strength of the U.S. dollar and recent decisions by the People's Bank of China to maintain its loan prime rates may further influence market dynamics in the coming weeks [9bc305f4].
Overall, the oil market remains highly sensitive to both geopolitical tensions and economic indicators, which will continue to shape its trajectory in the near future [600863c2].