The 80 dollars a barrel approaches it Brent with a rise of more than 2%.

The fear of a generalization of the war in the Middle East, involving Iran that could hurt its oil production and exports, is reasonable, given that Tehran supports Hamas, as well as Hezbollah in Lebanon and the Houthis in Yemen to act against Israel.

Because Iran did not seem willing to get directly involved in a war, oil prices moved lower as global oversupply conditions were created.

That was until OPEC stepped in and cut its own production further. After the intervention of OPEC, in which mainly Arab countries participate, the price of Brent moved for a time at higher levels, close to 85 dollars a barrel, but then they started to fall again. In the third quarter of 2024, Brent fell 17% and especially in September by 9%, falling below 70 dollars.

Thus, it turned out that OPEC no longer has the power it had in past decades to keep prices at artificially high levels for a long time and this is mainly due to the large increase in production from countries outside the cartel, mainly the USA.

Also, the reduction in production by the OPEC countries is depriving them of valuable revenue, to the extent that they cannot achieve their maximalist unofficial price target of $100 a barrel. So they have an incentive to increase production, which Saudi Arabia recently signaled it would do from December, pushing prices below $70.

Added to these two factors was limited demand from China due to its slowing economic growth, clearly creating conditions for an oversupply of the “black gold” in 2025. The picture was so clear for investors that bets on further declines in oil prices reached record levels recently.