Quote on Crude Oil price decline by Rajeev Sharan, Head of Research, Brickwork Ratings
Below the Quote on Crude Oil price decline by Rajeev Sharan, Head of Research, Brickwork Ratings
"Brent crude’s steep USD 10 per barrel decline since Tuesday, sliding nearly 9% yesterday alone to sit near USD 94, is not driven by weak demand. Instead, it reflects the rapid unwinding of the geopolitical risk premium. After high gasoline prices contributed to a Republican defeat in the U.S. midterms, Washington lost its appetite for conflict with Iran, prompting Wall Street to sell oil futures on hopes of peace. However, financial traders are moving ahead of reality. While paper prices are falling, physical barrels in the Middle East remain above USD 100 because shipping routes are still disrupted. Looking ahead, the outlook is split across two timelines. In the coming weeks, prices should find a firm floor near USD 90 as physical bottlenecks persist. By early 2027, if shipping lanes fully reopen, Gulf producers will likely boost supply to reclaim market share, pushing Brent toward USD 75."
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