• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 5 hours How Far Have We Really Gotten With Alternative Energy
  • 8 days What fool thought this was a good idea...
  • 11 days Why does this keep coming up? (The Renewable Energy Land Rush Could Threaten Food Security)
  • 6 days A question...
  • 11 days They pay YOU to TAKE Natural Gas
  • 17 days The United States produced more crude oil than any nation, at any time.
What Could Derail The Copper Rally?

What Could Derail The Copper Rally?

An increasingly electrified world means…

Are Hybrids and EVs Incompatible?

Are Hybrids and EVs Incompatible?

If the car manufacturers, or…

Oil Plummets over 3% as Stockpiles Override Iran-Israel Conflict

Only two days ago analysts were predicting oil over $100 a barrel, but by Wednesday midday, crude prices were nose-diving by close to 3% as demand concerns heavily outweighed the prospect of a wider regional conflict in the Middle East. 

At 12:41 p.m. ET on Wednesday, Brent crude oil was trading down 3.18% at $87.16, for a $2.86  per barrel loss on the day, while the U.S. crude oil benchmark, West Texas Intermediate (WTI), was trading down 3.25% at $82.59, for a loss of $2.77 per barrel on the day. 

Earlier on Wednesday, the Energy Information Administration (EIA) released its weekly inventory report showing a build of 2.7 million barrels to 460 million barrels in the week ending April 12. Expectations based on a Reuters poll had only been for a 1.4-million-barrel-build, causing oil prices to plummet. 

In the meantime, analysts have also walked back their fears of a wider regional war in the Middle East, assessing that Iran’s missile and drone strikes directed at Israel would not lead to severe sanctions on Iranian oil exports. 

"Oil prices go about their business of unwinding some of the war premium that has been priced in," also noting that oil prices were experiencing downward pressure over dwindling hopes of interest rate cuts by the Fed.  

After convening its war cabinet on Monday, Israel has still not decided on a response to Iran’s missile barrage–the bulk of which were shot down by Israel defense systems, allowing Tehran to portray itself as having launched an unprecedented retaliation for the leveling of its diplomatic facilities in Syria, despite the fact that the missile barrage had no real impact, other than in terms of rhetoric.

In the meantime, proxy warfare continues between Iran and Israel, particularly in Lebanon, where Israeli fighter jets struck Hezbollah targets in the south of the country in retaliation for an Hezbollah strike in northern Israel that injured 18 Israelis.

By Tom Kool for Oilprice.com


More Top Reads From Oilprice.com:

Join the discussion | Back to homepage

Leave a comment
  • George Doolittle on April 17 2024 said:
    US economy is a real mess so truly remarkable oil has done this well for this long given the context.
  • Mamdouh Salameh on April 17 2024 said:
    Don't jump the gun Mr Kool. Prices will resume their surge in a few days underpinned by solid fundamentals, robust demand, a tightening market and record-breaking Chinese crude imports.

    The decline in prices today is the calm before the storm when Israel retaliates against the Iranian strike and Iran counter-retaliates much harsher as it warned Israel.

    And while it is known that the minute prices start to rise, either the US Energy Information Administration (EIA) or the American Petroleum Institute (API) or both always announce a build in US oil inventories. This is one of the tools they use to depress oil prices but this ploy hardly lasts more than a day.

    Brent crude is headed towards $90-$100 a barrel soon and if geopolitical tension escalates sharply in the Middle East and causes a disruption of oil supplies from the Gulf region, Brent could surge above $100 and could even touch $120 for a short period.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News