Oil prices increased by more than 4.6% on Monday as the market processed recent Middle East developments and the dollar marginally weakened.
The price of Brent oil increased to $105.8 per barrel, rising 4.65% for the day. The price of West Texas Intermediate (WTI) was a little over $102 at the time.
Prices increased as traders evaluated Saudi attitude in the wake of President Joe Biden’s Friday visit with the Crown Prince.
Amos Hochstein, Biden’s adviser on global energy affairs, stated Sunday that Washington anticipated action from Middle Eastern OPEC producers – Saudi Arabia and the United Arab Emirates – to increase supplies to the oil market soon.
However, the prevailing opinion appears to be that the Saudis do not currently have any plans to interfere with oil prices. The sell-off that occurred last week as a result of expectations that Biden’s visit to Saudi Arabia may lead to an OPEC decision to boost output has now been reversed.
Due to investors lowering their anticipation of the Fed raising interest rates more aggressively next week, the U.S. dollar has declined, which has contributed to Monday’s increase in oil prices.
Monday saw a 0.464% decrease in the US dollar index.
Iraq’s oil minister told Bloomberg on Monday that oil prices are expected to stay above $100 for the rest of the year.
“I would like OPEC to retain its tools to measure and control output and maintain the existing balance,” Iraqi Oil Minister Ihsan Abdul Jabbar told Bloomberg. “We will discuss that with our partners.”
The OPEC+ group will meet again on August 3rd.
