Heated Geopolitical Tensions Drive Oil Prices Up
Oil prices increased in the global commodity market amidst rising tensions after Ukraine targeted several military air bases in Russia, as Kyiv and Moscow prepared for peace talks in Istanbul.
Price surge in a combat between forces of demand and supply after OPEC+ members agree to increase output, causing prices to dip while increasing geopolitical tensions nudge prices higher.
International benchmark Brent crude increased by around 2.61%, trading at $64.24 per barrel, up from $62.60 at the previous session’s close. Similarly, US benchmark West Texas Intermediate (WTI) rose by about 2.88%, reaching $62.02 per barrel, compared to $60.28 in the prior session.
Prices increased as Ukraine’s Security Service (SBU) on Sunday claimed to have destroyed 34% of Russian strategic bombers capable of carrying strategic cruise missiles during attacks on military air bases in Russia.
Ukrainian forces attacked Russia’s military airfields with unmanned aerial vehicles (UAVs), the SBU said in a statement. The SBU carried out a special operation called “Spider Web,” causing $7 billion in damage to Russia’s strategic aviation, the statement said.
As fighting escalates in the Russia-Ukraine war, attention has shifted to talks between the two sides set for today in Istanbul. The last negotiations between the two sides were held on May 16 at Istanbul’s Dolmabahce Palace.
The next round of talks between the two parties is expected to take place at 1 p.m. local time (1000 GMT) on Monday in Istanbul’s Ciragan Palace.
The prospect of new US sanctions against Russia if no agreement is reached with Ukraine soon is deepening supply concerns and driving prices higher. Last week, international media reported that US President Donald Trump was expected to move forward with additional sanctions on Russia.
Meanwhile, eight countries in the OPEC+ alliance, made up of the Organization of the Petroleum Exporting Countries and allied non-OPEC producers, agreed to raise supply by 411,000 barrels per day in July.
The decision, made by Saudi Arabia, Russia, Iraq, the United Arab Emirates, Kuwait, Kazakhstan, Algeria, and Oman, was in line with expectations and is easing concerns about oversupply and downward pressure on prices.
Elsewhere, developments related to US tariffs on its trading partners continue to drive price volatility. President Trump said during a Friday press conference in the Oval Office that China had violated its trade agreement with the US, adding that he would speak with Chinese President Xi Jinping and hoped to resolve the issue.
Trump’s remarks followed his accusation of China breaching the preliminary trade agreement after talks in Geneva on May 10-11, possibly fueling the trade tensions between the world’s top two economies. Fears that renewed trade tensions could dampen oil demand are curbing further price gains.
Israel fight dirty
In the latest round of assault, Israeli forces destroy Gaza after a series of unsuccessful peace talks. Israel continued its relentless bombardment of the Gaza Strip, killing at least 54 people, while maintaining a strict blockade as a famine looms
Israeli tanks and drones opened fire on Palestinians gathered at aid distribution sites run by an Israeli-and-US-backed group, killing more than 30 people as they searched desperately for food.
Saudi Arabia has accused Israel of “extremism and rejection of peace” after it blocked a planned visit by Arab foreign ministers to the occupied West Bank.
Saudi Foreign Minister Prince Faisal bin Farhan Al Saud made the remarks during a joint news conference in Jordan’s capital, Amman, on Sunday with his counterparts from Jordan, Egypt, and Bahrain.
“Israel’s refusal of the committee’s visit to the West Bank embodies and confirms its extremism and refusal of any serious attempts for [a] peaceful pathway … It strengthens our will to double our diplomatic efforts within the international community to face this arrogance,” Prince Faisal said. Alleged $12m Fraud- Court Fixes Date for SunTrust Bank’s MD Arraignment
