Oil prices hesitated on Friday, after having climbed the day before, the market still assessing the possibility that Russian oil installations would be hit by Ukrainian fire.
Around 11:50 GMT (12:50 p.m. in Paris), a barrel of Brent from the North Sea for delivery in January lost 0.47% to $73.88, after opening the session higher.
Its American equivalent, a barrel of West Texas Intermediate (WTI), for delivery the same month, fell 0.54% to $69.72.
The Kremlin said Friday it was certain that the United States “understood” Vladimir Putin’s message in his speech the day before, where he claimed responsibility for the firing against Ukraine of a new missile designed to carry a nuclear warhead .
He also said Moscow reserves the right to strike Western countries that allow Ukraine to use their weapons on Russian soil.
“No matter what usage limits the UK and US impose on Ukraine, what the market fears is an accidental destruction of oil, gas or refining facilities,” emphasizes Tamas Varga, analyst at PVM Energy, “which would cause long-term damage and also accelerate the spiral of war”.
In Iran, the situation is also tense, as the country announced on Friday that it was putting into service “new advanced centrifuges” as part of its nuclear program, in retaliation for the adoption in Vienna of a resolution reminding Tehran of its obligations. under the Non-Proliferation Treaty (NPT).
On the other hand, the market also takes into account “the monthly drop in Chinese oil demand, a hesitant OPEC+” on a possible continuation of voluntary production cuts and “a raging American dollar”, which increases the cost from the barrel, tempers Tamas Varga.
On the gas side, “the arrival of cold weather in Europe aggravates the situation and the dependence, although less (since the start of the conflict, editor’s note), of the continent on Russian gas remains a real problem”, underlines the analyst.
The Russian gas giant Gazprom also interrupted its deliveries to Austria last weekend, which is still very dependent on this supplier, amid contractual disputes.
On Thursday, the American government announced a series of sanctions which target in particular the financial arm of Gazprom, Gazprombank, as well as around fifty other Russian banking establishments in order to limit “access to the international financial system” and reduce the financing of the Russian war effort in Ukraine.
* **How does the author use expert commentary to explore the impact of geopolitical instability on oil prices and global energy markets?**
## World Today News: Oil Markets and Global Instability – An Interview
**Host:** Welcome to World Today News, where we dissect the day’s biggest events and their impact on the world. Today, we’re diving into the tumultuous energy markets, particularly the volatility of oil prices, and the geopolitical tensions driving these fluctuations. Joining us are two experts: Dr. Anya Petrova, an energy economist specializing in Russian and Eastern European energy markets, and Mr. David Smith, a senior analyst at a leading global financial institution with expertise in geopolitical risk assessment.
**Section 1: Oil Prices and Geopolitical Uncertainty**
**Host:** Dr. Petrova, the article mentions that oil prices hesitated after a rise, seemingly spurred by the possibility of Ukrainian attacks on Russian oil installations. Can you elaborate on how conflict directly impacts oil prices, beyond the immediate threat to infrastructure?
**Dr. Petrova:** Certainly. Armed conflict creates a climate of uncertainty and risk. Investors become wary, leading to market volatility.
**Host:** Mr. Smith, how do you see the interplay between geopolitical tensions, like those arising from the Ukraine war and Iran’s nuclear program, and the oil market?
**Mr. Smith:** The situation in Ukraine clearly demonstrates how geopolitical instability can disrupt supply chains and drive up prices. Iran’s actions add a layer of unpredictability, potentially impacting global oil supply.
**Host:** Are these geopolitical risks the primary drivers of current oil price volatility, or are there other significant factors at play?
**Section 2: Emerging Trends and Global Players**
**Host:** Dr. Petrova, China’s demand for oil has reportedly decreased. Is this a short-term fluctuation, or a signal of a larger shift in global oil consumption patterns?
**Dr. Petrova:** China’s economic slowdown definitely plays a role, but it’s important to remember that energy demand is susceptible to seasonal variations as well.
**Host:** Mr. Smith, OPEC+’s hesitancy regarding production cuts is also mentioned. How important is OPEC+’s role in stabilizing the oil market, and what factors might influence their future decisions?
**Mr. Smith:** OPEC+ plays a crucial part in balancing supply and demand. Their decisions are complex, taking into account factors like global economic growth, political pressures, and individual member state interests.
**Host:** Given the fluctuating oil prices, what strategies might different stakeholders – governments, businesses, and consumers – adopt to navigate this uncertain environment?
**Section 3: Looking Ahead: Sustainability and Energy Security**
**Host:** Mr. Smith, the article highlights Europe’s continued reliance on Russian gas despite the conflict. How might the geopolitical climate shape Europe’s long-term energy strategy, particularly regarding energy independence and diversification?
**Mr. Smith:** The current situation is accelerating Europe’s search for alternative energy sources and supply routes. This shift could lead to increased investment in renewable energy and stronger partnerships with other energy producers.
**Host:** Dr. Petrova, considering the environmental concerns surrounding fossil fuels, how crucial is the need for a sustainable and diversified energy future, both for individual nations and the global community?
**Dr. Petrova:** The urgency for a transition to sustainable energy cannot be overstated. It’s not just about mitigating climate change but also ensuring energy security and reducing our reliance on volatile geopolitical landscapes.
**Host:** Thank you both for sharing your valuable insights. This has been a fascinating discussion of the complex intersection between energy markets, geopolitical events, and the global economy.
