- The WTI price reduces profits about $ 73.25 in the first bars of the Asian session on Friday.
- Trump will decide in two weeks if he attacks Iran.
- Uncertainty about the possible participation of the US in the Israel-Iran conflict could limit the fall of the WTI.
The West Texas Intermediate (WTI), the referent of the US crude oil, trades around $ 73,25 during Friday’s Asian negotiation hours. The price of WTI drops slightly after the announcement of US President Donald Trump that he will decide on US participation in the Israel-Iran conflict within two weeks.
Bloomberg reported on Thursday that Trump will make the decision in two weeks about whether to attack Iran, since Israel has hit more Iranian nuclear sites and warned that their attacks could overthrow leadership in Tehran. His last position indicates a setback after a series of hard rhetoric, which drags the price of the WTI downward.
Israeli war planes attacked dozens of military objectives in Iran during the night, including an inactive nuclear reactor in the Arak area. Oil operators will closely follow developments around geopolitical risks. Any climbing signal of tensions and fears that the Israel-Iran crisis could become a broader conflict that involves the US could boost black gold in the short term.
The estimation of a lower demand could limit the wi’s bullish potential. In its monthly report on the oil on Tuesday, the International Energy Agency (AIE) reviewed its decrease in world demand for oil in 20,000 barrels per day compared to the forecast of last month and increased supply estimation in 200,000 BPD to 1.8 million BPD.
WTI FAQS oil
WTI oil is a type of crude oil that is sold in international markets. WTI are the acronym of West Texas Intermediate, one of the three main types that include the Brent and Dubai’s crude. The WTI is also known as “light” and “sweet” by its relatively low gravity and sulfur content, respectively. It is considered high quality oil that is easily refined. It is obtained in the United States and is distributed through the Cushing Center, considered “the crossing of the world.” It is a reference for the oil market and the price of WTI is frequently traded in the media.
Like all assets, supply and demand are the main factors that determine the price of WTI oil. As such, global growth can be a driver of the increase in demand and vice versa in the case of weak global growth. Political instability, wars and sanctions can alter the offer and have an impact on prices. OPEC decisions, a group of large oil -producing countries, is another key price factor. The value of the US dollar influences the price of WTI crude oil, since oil is mainly traded in US dollars, so a weaker dollar can make oil more affordable and vice versa.
Weekly reports on oil inventories published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) influence the price of WTI oil. Changes in inventories reflect the fluctuation of supply and demand. If the data show a decrease in inventories, it can indicate an increase in demand, which would raise the price of oil. An increase in inventories may reflect an increase in supply, which makes prices lower. The API report is published every Tuesday and that of the EIA the next day. Their results are usually similar, with a 1% difference between them 75% of the time. EIA data is considered more reliable, since it is a government agency.
The OPEC (Organization of Petroleum Exporting Countries) is a group of 13 nations oil producing that collectively decide the production quotas of member countries in biannual meetings. Their decisions usually influence WTI oil prices. When OPEC decides to reduce fees, it can restrict the supply and raise oil prices. When OPEC increases production, the opposite effect occurs. The OPEC+ is an expanded group that includes another ten non -members of the OPEC, among which Russia stands out.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
