Brent crude oil futures experienced a significant drop, moving toward $71 per barrel on Thursday, following a decline of over 2% from the previous session. This downturn was triggered by rorts that Saudi Arabia, the leading oil exporter, is lowering its crude oil price target in anticipation of increased production. In a related development, Libya's competing factions have reached an agreement to establish a process for appointing a central bank governor, potentially alleviating the ongoing oil revenue crisis and paving the way for a restoration of exports.
However, uncertainty surrounding demand persists, particularly in China, despite recent monetary measures aimed at stimulating activity in the world's largest oil-consuming nation. Meanwhile, data from the U.S. Energy Information Administration (EIA) indicated a drop in U.S. crude stocks by 4.5 million barrels last week, far surpassing the anticipated decrease of 1.4 million barrels. The risk of supply disruptions in the Middle East is further complicated by escalated violence in the region, which continues to lend some support to prices.
Since the start of 2024, Brent has declined by $5.16, reflecting a 6.69% decrease. Forecasts suggest that Brent crude oil is likely to trade at $77.45 per barrel by the end of this quarter, according to global macro models and analysts' projections. Looking ahead, it is estimated to rise to $79.05 in the next 12 months.