Crude Oil Prices Weaken Further

Jakarta, - Oil prices are now declining further due to the widespread global risk atmosphere in the market, as the strengthening of the United States (US) dollar masks concerns in the Middle East region. 

Based on Bloomberg data, Tuesday (16/1/2024), the price of West Texas Intermediate (WTI) oil for the February 2024 contract weakened -1.81% to US$71.09 per barrel at 21.27 WIB.  

The price of Brent oil for the March 2024 contract, which had previously strengthened this morning, has weakened -1.69% to US$76.97 per barrel.

Commodity prices continue to weaken amid the end of the pandemic. Apart from crude oil, copper and other industrial commodities also fell.

As oil prices moved into the red zone, the country with jumbo consumption, China, today (17/1) reported mixed economic data. 

Oil prices had surged due to tensions in the Middle East. Including the actions of the Houthis who threatened shipping in the Red Sea.

Many oil and gas transportation companies are now avoiding this route. Cargo players are choosing to take longer routes around southern Africa. 

Egypt also reported that Suez Canal transit fell by almost a third compared to last year in the first 11 days of this year.

"The good news, and likely the reason why crude prices didn't spike, is that global oil supplies due to the Red Sea attack were not affected," explained analyst at Commonwealth Bank of Australia, Vivek Dhar. 

He went on to say that the bad news is that the alternative route around Africa takes 14 days longer.

Then, the extremely cold temperatures in the US also hampered refinery operations in Texas processing centers and shut down more than half of oil production in North Dakota.

The North Dakota Pipeline Authority said that as much as 650,000 barrels per day were out of service, up from 425,000 barrels on Monday (15/1).

Sources : Jan 17.24

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