Oil fell from its highest point in three weeks as persistent worries about the outlook for demand outweighed the ongoing tensions in the Middle East, Bloomberg reported on Monday. Brent crude dropped below $83 a barrel after rising by almost 8 per cent for two weeks. West Texas Intermediate stood at approx. $79 a barrel. The International Energy Agency warned last week that there may be an annual surplus of oil on the market and that concerns about consumption have been raised by China's weak economy. However, the Israeli war on Gaza and Red Sea shipping attacks are preventing prices from dropping too much. "For any oil price premium to be sustained in oil markets from Middle‐East tensions, physical oil supply needs to be disrupted," Vivek Dhar, an analyst at Commonwealth Bank of Australia told Bloomberg. Concerns about supply are likely to cause Brent futures to give up their gains in the upcoming weeks, he continued. Bullish bets for the worldwide benchmark Brent are at the highest Since 2021, Bullish wagers for global benchmark Brent are at the highest since 2021 after the ratcheting up of geopolitical risks in the region, which accounts for around a third of the world's crude production. Following the week-long Lunar New Year holiday, Chinese markets have reopened, and Shanghai's crude prices have increased.
