MercoPress. South Atlantic News Agency

Brent crude down amid weak demand

Iran's threats to Israel could jeopardize supply, it was explained

London's futures markets showed a 1.96% decline Tuesday for Brent crude oil to be delivered in October amid contracting demand, which drove it to US$ 80.69 as North Sea crude, the European benchmark, fell US$ 1.61 from the last Intercontinental Exchange (ICE) trading. Meanwhile, in New York, the price of West Texas Intermediate (WTI) for delivery in the same period fell 2.11% and closed at US$ 76.80.

This outcome after five consecutive days on the rise, which had not happened since February, followed a slight downward revision of OPEC's growth forecasts and cautious projections by the International Energy Agency (IEA).

Brent is believed to have taken the blow amid fears of war in the Middle East given Iran's threats to Israel, which could jeopardize supply in the region.

According to the IEA, “global demand should grow by less than 1 million barrels per day in 2024 and 2025,” below the pre-pandemic growth trend. It also forecasted consumption in 2024 to reach 103.06 million barrels per day (mbd) from 102.09 mbd in 2023 and 100.6 mbd in 2019.

“As the post-pandemic revival wears off, clean energy transitions progress and the structure of the Chinese economy evolves, global oil demand growth slows and should peak in 2030,” IEA Executive Director Fatih Birol stressed.

OPEC, meanwhile, revised downwards its forecast for global demand growth by 135,000 barrels per day, mainly because of uncertainty over the Chinese economy, projecting a demand of 104.32 mbd in 2024 and 106.11 mbd in 2025.