Crude oil prices this year could be the lowest in three years

Brent and WTI crude are headed for a 10% drop this year, ending a two-year winning streak.

On December 29 - the last trading session of 2023 - Brent crude oil prices increased by 0.2% to $77.4 a barrel. Similarly, each barrel of US WTI crude oil increased to $72.

At this level, both global benchmarks are on track to close 2023 at their lowest levels since 2020 - when the Covid-19 pandemic hit, causing oil demand and prices to plummet.

However, fuel prices stabilized today after falling 3% on December 28. The resumption of shipping routes through the Red Sea after a period of interruption was one of the reasons for the slight increase in oil prices. Previously, many large companies stopped using this route after the Houthi group in Yemen attacked cargo ships there.

Brent and WTI are on track to post a 10% decline this year, the first time prices have fallen since two years of increases, driven by geopolitical tensions, production cuts and global inflationary pressures. Brent is now down nearly 20% from its peak of nearly $98 in late September.

Prices spiked in September after the Organization of the Petroleum Exporting Countries and its allies (OPEC+) agreed to cut production, raising concerns that demand would outstrip supply.

This year, inflationary policies by governments and central banks have made it difficult for oil prices to rise sharply. In 2024, investors and analysts expect a weaker US dollar and lower interest rates in key oil-consuming markets to boost fuel demand.

Ha Thu (according to Reuters)

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