Volatilityย in theย oil market has intensified during last weekโs close, withย crude futuresย registering significant declines that practically erase theย accumulated gainsย of the week.
West Texas Intermediate (WTI), the U.S. benchmark, experienced aย near 2.2% drop, driven mainly byย geopolitical factorsย andย supply dataย that have surprised to the downside.
In particular,ย pressureย from theย U.S. administrationย on the Iraqi government to restartย Kurdish crude exportsย to Turkey has been one of the most relevant catalysts, creatingย uncertaintyย in supply flows.
Data released by the Energy Information Administrationย reinforce theย bearishย trend. The increase ofย 4.6 million barrelsย in crude inventories suggests aย weaker-than-expectedย domestic demand, whichย further pressuresย prices downward.
However, not all is pessimism:ย gasoline stocksย fell byย 0.2 million barrelsย andย distillatesย declined byย 2.1 million barrels, which could temporarily support the value of these refined products.
On the geopolitical front, the pressureย exerted byย Washingtonย to reactivate the pipeline connectingย Kurdish fieldsย with Turkey and curbย smugglingย into Iran marks a new chapter in the U.S. โmaximum pressureโ policy against Tehran. Although theย Iraqi Oil Ministerย announced the resumption ofย Kurdish exportsย in the coming days, there is stillย uncertaintyย regardingย technicalย andย financialย hurdles that could delay its implementation.
Anย immediate reboundย in supply from these blocked barrels would pressure prices downward; however, anyย political setbackย orย stalledย peace negotiations in other key regions could trigger aย bounce.
In summary, the oil outlook continues to be characterized by high volatility, reflecting the constant interplay ofย supply and demand dataย as well asย geopolitical tensions.
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