The price of oil fell by more than 1% amid the strengthening of the US dollar and the news that Saudi Arabia has lowered official selling prices for all regions. Some support for prices was provided by concern over Red Sea tensions and supply disruptions in Libya.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.16% to 102.57.
Meanwhile, Saudi Aramco - the national oil company of Saudi Arabia - lowered its flagship Arab Light price to Asia by a more-than-expected $2 a barrel due to persistent weakness in the global crude market.
Tensions in the Middle East are also in focus. U.S. Secretary of State Antony Blinken said the Gaza conflict could spread across the region unless there is a concerted peace effort. Israeli Prime Minister Benjamin Netanyahu vowed to continue the war until Hamas was eliminated.
In addition, Libya's National Oil Corporation announced force majeure at the Sharara oil field (the largest in the country) after it was closed by protesters. The closure of this field led to a halt in supplies to the terminal in Zawiya, the NOC reported.
At the end of last month, Goldman Sachs reduced its forecast as it sees Brent averaging $80/$81. This forecast converges with that of IEA, which sees Brent at $82.57 per barrel in 2024. Barclays is still on the higher side and sees oil averaging $93 in 2024, while S&P Global thinks $85 is more appropriate.