Oil stabilizes as ease of supply risk drives weekly losses according to Reuters
Written by Nicole Jao
NEW YORK (Reuters) – Oil prices eased on Friday and posted a weekly decline of more than 3%, pressured by easing concerns about supply risks from the Israel-Hezbollah conflict and hopes of a supply increase in 2025 as OPEC+ is expected to widen the output cut.
down 34 cents, or 0.46%, to settle at $72.94 a barrel. US West Texas Intermediate crude futures fell 72 cents, or 1.05%, to settle at $68, from the last close before Thursday’s Thanksgiving holiday.
Trading activity has been muted due to the US public holiday.
For the week, Brent fell 3.1% while WTI fell 4.8%.
Four Israeli tanks entered a village on the Lebanese border, Lebanese media said on Friday. The ceasefire that came into effect on Wednesday has brought down the price of oil, lowering prices, despite allegations of violations by both sides.
However, the conflict in the Middle East did not affect the supply, which is expected to be more abundant in 2025. The International Energy Agency sees a prospect of more than 1 million barrels per day (bpd) of oversupply, equivalent to more than 1% of global output.
“The updated summary suggests that next year promises to be looser than the current one and oil prices will be below the level of 2024,” said Tamas Varga of oil broker PVM.
The OPEC+ group, which includes the Organization of the Petroleum Exporting Countries and its allies including Russia, has delayed its next policy meeting until Dec. 5 from Dec. 1. OPEC+ is expected to decide on the extension of production cuts at the meeting.
“After the two postponements, the group should consider the risk of further weakening of prices amid the withdrawal of currently unwanted barrels, not least because the expectation of strong production from non-OPEC+ producers next year could lead to more money,” said a Saxo Bank analyst. Ole Hansen.
Brent could average $74.53 a barrel by 2025, a Reuters poll of 41 analysts suggests. That marked the seventh consecutive monthly downward revision in the Reuters poll.
