WASHINGTON (dpa-AFX) - Oil prices fell sharply on Tuesday as fears about supply disruptions faded on reports Israel will avoid targeting Iran's oil and nuclear sites.
According to a report in Washington Post, Israeli Prime Minister Netanyahu told U.S. that he is willing to strike military rather than oil or nuclear facilities in Iran.
The OPEC and the International Energy Agency's downward revisions in their oil demand forecast for 2024 also weighed on oil prices.
West Texas Intermediate crude oil futures for November ended down $3.25 or about 4.4% at $70.58 a barrel.
Brent crude futures settled at $74.25 a barrel, down $3.21 or about 4.14% from the previous close.
OPEC said in its report that it expects oil demand will grow by 1.9 million barrels per day in 2024, down from 2 million bpd in its previous forecast. The group expects oil demand to grow by 1.6 million barrels per day in 2025, compared with an earlier forecast of 1.7 million bpd.
World markets face a surplus of more than 1 million barrels a day next year that will replenish inventories from their current low levels, the International Energy Agency said in a monthly report, citing swelling American production, weak Chinese oil demand and spare capacity in the OPEC+ alliance that is near record levels.
The IEA expects demand to grow by just under 900,000 barrels per day in 2024 and 1 million bpd in 2025, a significant slowdown compared with growth of 2 million bpd in the post-pandemic period.
Traders now await weekly oil reports from the American Petroleum Institute (API) and U.S. Energy Information Administration (EIA). The API report is due later today, while the EIA data is due Wednesday morning.
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