Geopolitical Risks Support Crude Prices

Group 1 - Crude oil and gasoline prices increased due to heightened geopolitical risks in Europe, particularly after Poland shot down Russian drones, which was labeled an "act of aggression" [2][3] - OPEC+ has agreed to raise crude production by 137,000 barrels per day (bpd) starting in October, which is significantly lower than the previous increase of 547,000 bpd in the prior months [4] - Concerns regarding the ongoing war in Ukraine may lead to additional sanctions on Russian energy exports, potentially reducing global oil supplies [5] Group 2 - The escalation of geopolitical tensions in Europe and the Middle East is seen as bullish for crude prices, with Israel's recent military actions in Qatar further complicating the situation [3] - A bearish factor for crude prices emerged when Saudi Arabia cut prices for all crude grades by $1 per barrel for Asian buyers, indicating weak demand [6] - Reduced Russian crude output, due to Ukrainian attacks on Russian refineries, has tightened global oil supplies, supporting higher prices [4]