Oil Prices Drop to $72 Per Barrel After al-Assad’s Fall
Global oil prices experienced a slight decline on Tuesday, with Brent crude falling to $72.06 per barrel and the US West Texas Intermediate (WTI) crude dropping to $68.23 per barrel, following the dramatic overthrow of Syrian President Bashar al-Assad.
The drop in prices, which followed a 1% rise on Monday, eased concerns about potential disruptions in the region. While Syria is not a major oil producer, its strategic location and alliances with countries like Russia and Iran have given it significance in the global oil market. Assad’s 14-year rule ended on Sunday, December 8, when rebel groups took control of Damascus, leading to the formation of a new government and the resumption of key sectors, including oil production.
Despite the political developments in Syria, oil market declines were tempered by other global factors. Positive economic indicators, particularly the expectation of a rate cut by the US Federal Reserve in mid-December, supported oil prices. The Federal Reserve is anticipated to reduce interest rates by 25 basis points during its meeting on December 17–18, which could boost oil demand in the US, the world’s largest economy. However, traders remain cautious, awaiting inflation data later this week that could influence the Central Bank’s decision.
Additionally, optimism about China’s economic outlook helped stabilize oil prices. Reports suggest that China will implement an “appropriately loose” monetary policy in 2024, its first easing in 14 years, aimed at spurring growth in the world’s largest oil-importing nation.
In other oil news, the Organisation of Petroleum Exporting Countries (OPEC) recently extended Nigeria’s oil production quota of 1.5 million barrels per day (bpd) until 2026, providing further stability to the market.
