GlobalWide News
The Wall Street Journal: The International Energy Agency (IEA) warns that the conflict in Israel and escalating tensions in the Middle East pose a growing risk to global oil markets. According to the agency, “While there has been no direct impact on physical supply, markets will remain on tenterhooks as the crisis unfolds.” This comes as demand for oil is projected to rise to a record 101.9 million barrels a day in 2023, fueled in part by strong growth in China.
The report also highlights the risk from a tightened oil supply by the Organization of the Petroleum Exporting Countries (OPEC). The IEA emphasized, “Against a backdrop of tightly balanced oil markets…the international community will remain laser focused on risks to the region’s oil flows.” Brent crude prices have already crossed $90 a barrel after Hamas’s surprise attack on Israel. While neither Israel nor the Palestinian territories are major oil producers, concerns are that the conflict could affect major regional oil suppliers like Iran.
The agency also revised down its oil demand growth expectations for 2024 and noted a substantial market deficit amid OPEC-led cuts. It raised concerns over rising oil prices fueling inflation fears, stating that this could result in “possibly pushing the fragile global economy into stagflation.” Furthermore, the IEA observed that Russian oil revenue surged to nearly $19 billion in September, and rising prices are benefiting other oil producers including Iran.
The entire article can be read at the link https://www.wsj.com/business/energy-oil/iea-warns-of-increased-risk-to-oil-markets-amid-israel-conflict-3a7a5f11?mod=business_feat3_energy-oil_pos1
