Major decline in the oil market

Prices in global oil markets retreated on the final trading day of the week, as market participants acted on concerns that rising inflation could reduce oil demand worldwide. Despite this pressure, the possibility of a weekly upward close remains notable, as geopolitical events have increased price volatility throughout the week.

The price of a barrel of Brent crude oil fell by 0.08 percent to 76.24 dollars. At the same time, US West Texas Intermediate (WTI) crude oil also saw a decline of 0.06 percent, trading at 72.04 dollars. Conversely, looking at weekly performance, Brent oil is projected to finish the week with an increase of approximately 6 percent, and WTI with an increase of around 5 percent.

NEW TENSIONS BETWEEN IRAN AND THE US

Following US strikes on the southern and eastern regions of Iran, the Iranian military retaliated against American military assets in the Gulf on Thursday. Experts emphasize that uncertainties regarding the fate of the current ceasefire in the region are increasing.

During the same days, it was reported that a series of violent explosions occurred in Bushehr, where one of Iran's most important nuclear facilities is located, and in surrounding cities. These developments have caused risk perception in the region to escalate.

Another notable aspect of the resumption of hostilities is that it coincided with a day when large-scale mourning ceremonies, which have been ongoing for a week following the death of Iran's Supreme Leader Ayatollah Ali Khamenei, were still taking place.

MARKETS FOCUSED ON MESSAGES FROM THE US

ANZ Bank Senior Commodity Strategist Daniel Hynes stated that despite the US increasing its military strikes, markets are viewing the situation positively, particularly because the American administration has not launched a direct attack on Iran's energy infrastructure. Hynes said, "This expectation is reinforced by President Donald Trump's statements that he does not foresee a full-scale conflict breaking out again."

US President Donald Trump, in a press statement on Wednesday, had said that he did not expect a new war to begin and that "any development that happens from now on will end very quickly."

Oil markets are going through a period where macroeconomic indicators are being closely monitored despite high geopolitical tension. Experts expect this volatile trend to continue in the coming weeks.

News Source: 12punto