Sharp drop in oil prices

The price of a barrel of Brent oil, which yesterday closed the day at $82.45, fell to $78.91, with a decrease of 4.29 percent compared to today’s close at 4:37 p.m.

At the same time, West Texas crude oil sold for $74.56 a barrel.

Data on falling demand in the US, the world’s largest oil consumer, continues to influence prices.

The American Petroleum Institute announced that crude oil stocks in the country increased by 9 million 47 thousand barrels. The market expectation was that inventories would increase by 1 million 467 thousand barrels.

Official stock data from the US Energy Information Administration will be released today. If the data on this increase in stocks is confirmed, prices are expected to continue their downward trend.

On the other hand, the minutes of the US Federal Reserve (Fed) meeting held from October 31 to November 1 reveal that banking officials agreed that a cautious approach should be adopted in the course of monetary policy, and that monetary policy may be tightened further if available data shows that progress in reducing inflation is insufficient.

The minutes state that all officials were of the opinion that it would be appropriate for monetary policy to remain restrictive until inflation falls sustainably to the determined target.

The appreciation of the dollar against other currencies due to this news flow also supported the drop in oil prices. The US dollar index rose 0.26 percent from yesterday’s close and reached 103.717. The appreciation of the dollar makes oil more expensive for buyers who use other currencies to purchase it, causing a decrease in demand.

POSITIVE NEWS FROM THE MIDDLE EAST

The news that Hamas and Israel agreed to a prisoner exchange and a four-day humanitarian pause also eased supply-side concerns and contributed to the drop in prices.

Israel and Hamas agreed to a compromise that would provide a humanitarian pause to the conflict that would take effect on November 23. Consequently, there will be a four-day humanitarian pause in the fighting.

However, concerns that the OPEC+ group could make further cuts to bring prices to the desired level at the meeting scheduled for November 30 prevented a further decline in oil prices.

Producing countries, led by Saudi Arabia and Russia, may make supply cuts from time to time to keep oil prices at the desired level and thus protect their incomes. (AA)