Oil Markets in a Tightrope Walk: Supply Scarcity and Economic Woes

Oil prices are caught between tight supplies and the gloomy shadow of economic uncertainty. The tug-of-war in the oil market is evident as Brent Crude nudges just over $82 per barrel, and West Texas Intermediate hovers around $77.50, both encapsulated within a $10 trading range that has defined this year’s market dynamics. While the specter of high interest rates and the potential for subdued economic growth push traders to shy away from riskier assets like crude oil, the physical markets tell a different story. Here, shortages in refined products have lent strength, with Brent’s prompt spread reaching three-month highs, a clear sign of market tightness.