Oil price gains in face of geopolitical risk
LONDON, November 16, 2015 – Oil prices briefly rose today after French airstrikes on ISIS targets in Syria in retaliation for the attacks on Paris on Friday. Buyers concerned about regional supply stability edged the barrel price up by 0.9 percent in the US after an 8 percent decrease the previous week.
The oversupply of oil and high inventories kept the price increase minimal despite falling rig counts, with the price of Brent crude rising 0.6 percent to $44.7 per barrel in the London Stock Exchange.
Future decisions by the international community to reduce smuggling or target facilities under Islamic State’s control could, however, influence demand and create a mid-term increase in prices. However, activities in the oil and gas market are expected to create greater impact on prices than political developments.
Oil prices have decreased more than 60 percent since June 2014 to $44.8 per barrel in the US on November 16, with the glut in the market coinciding with the global economic slowdown and high production volumes worldwide to prevent a greater spike.
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