Brent Steady As Supply Glut Outweighs Geopolitical Tension
Global oversupply continued to mitigate instability around the world and kept Brent crude oil prices low to begin the week.
The commodity traded at $105.00 at 8:45 a.m. GMT after falling to a four-month low last week.
However, CNBC reported that some see Brent prices gaining momentum this week, as the situation in Libya looks to be worsening. On Sunday, the Libyan government reported more than 20 people dead after a fire near the city’s fuel depot burned out of control.
Rebel groups have been fighting in the nation’s capital for weeks trying to gain control of the airport. Although the Libyan government has regained control of several oilfields after making agreements with the groups that blockaded them, many worry that the situation is slowly slipping out of control and could lead to another supply outage.
The conflict in Iraq was also worrying, as Islamic militants were able to gain control of an oilfield as well as Iraq’s largest dam on Sunday.
So far, Iraqi oil output has not been slowed by the fighting as most of it has been isolated to the north, while the majority of the nation’s oil is produced in the south. However, if the rebel groups continue extend their reach, the country could be pushed into a civil war.
Meanwhile, tension between the West and Russia continued to worsen as Russia began new military exercises near the border or Ukraine on Monday.
The exercises included bombers and fighter jets, and is likely designed as a show of strength to Western powers.
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