Oil Prices Declining: China's Financial Briefing Disappoints Expectations

The global oil market is currently significantly influenced by developments in Asia and the Middle East. The price of Brent crude fell below the $78 per barrel mark, having already dropped by 0.5% on Friday. West Texas Intermediate was quoted near $74. The reason for these price movements is the absence of new economic stimulus announcements by the Chinese Ministry of Finance, despite indications of support for the struggling real estate sector and a possible increase in government borrowing. However, the markets had hoped for clearer fiscal stimuli. Meanwhile, oil traders are closely watching Israel's reactions to the ballistic missile attack by Iran on October 1st. According to a report, Israel has narrowed its potential targets to military and energy infrastructure. The conflict in the region led to an attack over the weekend by a Hezbollah drone, which resulted in the death of four Israeli soldiers. In response, the Pentagon announced it would deploy an advanced missile defense system with troop support to secure Israel. The monthly increase of Brent by about 9% highlights the potential for tension in the Middle East, which threatens oil production in a region that accounts for approximately one-third of the global oil supply. This has caused hedge funds to unwind their bearish bets against the crude oil benchmark at a near-record pace.