Oil prices drop by over $1 due to demand worries despite Iran-Israel tensions; Brent crude at $89 per barrel

Oil prices took a significant hit on Wednesday, April 17, dropping more than $1 as a result of rising US commercial inventories and concerns about global demand. Weaker economic data from China, combined with dampened prospects of interest rate cuts, added to the worries. Despite Iran’s recent missile and drone strike on Israel, analysts do not anticipate dramatic US sanctions on Iran’s oil exports, even in light of Janet Yellen’s comments.

The decline in oil prices can be attributed to a combination of factors. The increase in US commercial inventories suggested a surplus in supply, which put downward pressure on prices. Additionally, concerns about the global economy, particularly in China, led to worries about reduced demand for oil. The lack of immediate action on US sanctions following Iran’s attack on Israel also contributed to the drop in prices.

Despite the tensions in the Middle East and the potential implications for oil markets, experts believe that the current situation is not likely to lead to a significant disruption in oil supply. The market reaction to Iran’s actions, as well as the overall outlook for global demand, will continue to influence oil prices in the coming days.

While the situation remains fluid, it is clear that market dynamics and geopolitical factors are playing a significant role in shaping oil prices. Investors and analysts will be closely monitoring developments in the Middle East, as well as economic indicators, to assess the future trajectory of oil prices in the near term.