Oil prices fell more than 2 percent as concerns of supply disruption in the Middle East eased following Saudi Arabia’s commitment to stabilizing the market. Brent futures dropped $2.10, or 2.4 percent, to $85.55 per barrel, while US West Texas Intermediate (WTI) crude fell $2.55, or 3.0 percent, to $83.42.
This decline comes after both Brent and WTI crude surged more than $3.50 on Monday amid fears that the Israel-Hamas conflict could escalate and disrupt global oil supply. However, prices fell slightly on Tuesday when Saudi Arabia reassured it was working to prevent escalation and stabilize the oil market.
Exxon Mobil announced an all-stock acquisition of US rival Pioneer Natural Resources, valued at $59.5 billion. This acquisition would make Exxon Mobil the largest producer in the Permian shale, the largest US oilfield.
Russian President Vladimir Putin, after meeting with Saudi Arabia, emphasized the importance of OPEC+ coordination for oil market predictability. He also urged companies to prioritize the Russian domestic market.
Investors are also awaiting the release of the US Federal Reserve’s September policy meeting minutes for insights into future interest rate decisions. US Treasury Secretary Janet Yellen expressed her expectation for a soft landing for the US economy, despite additional concerns from the situation in Israel.
In Europe, the German government confirmed expectations of a 0.4 percent contraction in the economy this year due to persistently high inflation. The US Energy Information Administration (EIA) predicted global energy consumption would increase through 2050, outpacing energy efficiency advances. The EIA will release its US oil supply and demand expectations later on Wednesday.
