Citi Clarifies Reasons for Oil Price Drop By Investing.com

Citi Clarifies Reasons for Oil Price Drop By Investing.com
Citi Clarifies Reasons for Oil Price Drop By Investing.com

Bank of America’s latest oil market report indicates a significant decline in oil prices. This change is mainly due to the change in market structure, which places less emphasis on political issues related to international relations and more on the abundance of supply.

According to Citi’s assessment, the market’s assessment of political risks in the Middle East has decreased, which has contributed to a reduction in Brent crude oil prices. These prices temporarily fell below $82 per barrel. Despite the persistence of conflicts in this region, the market’s attention has shifted towards a more abundant supply situation.

“The market has moderated its view on how political events in the Middle East could affect global oil supply. This change, along with a reduction in the additional cost of risk in over-the-counter options, has led significant downward pressure on crude oil prices,” the bank said.

Citi forecasts a steady decline in oil prices for the year 2024. It expects the price to be around $86 per barrel in the second three-month period and around $74 per barrel in the during the third three-month period. Despite the recent drop in prices, Citi advises against impulse purchases based on speculation. She recommends that investors take advantage of price increases by selling during these periods.

“Given that crude oil prices are currently more than $10 per barrel lower than their peak, we cannot rule out the possibility of some speculative buying. However, we still believe that the best approach, given the balance between political risks and increasing availability of supply, is to sell during price increases,” they added.

Third-party advertising. This is not an offer or recommendation by Investing.com. Read the warning here Or
remove the ads
.

This article was produced and translated with the help of artificial intelligence and has been reviewed by an editor. For further details, please see our terms and conditions.

-

-

PREV Cannes Film Festival – Cannes Film Festival 2024: nationality, age, gender… here is the sketch of the Palme d’Or winner
NEXT Videos. Where does the Palme d’Or at the Cannes Film Festival come from?