Rising Oil Prices Amid Europe and Middle East Tensions: What Investors and Businesses in Oman Need to Know
SINGAPORE/NEW DELHI – Oil prices rose on Monday, bolstered by geopolitical tensions in Europe and the Middle East, although concerns over increased supply and trade tariffs tempered market enthusiasm.
Brent crude futures climbed 45 cents, or 0.67%, reaching $67.13 per barrel by 07:01 GMT. Meanwhile, US West Texas Intermediate (WTI) crude for October delivery increased by 47 cents, or 0.75%, to $63.15 per barrel. With the October WTI contract expiring Monday, the more actively traded November contract gained 43 cents, or 0.69%, settling at $62.83 per barrel.
Michael McCarthy, CEO of investment firm Moomoo Australia and New Zealand, noted that reports over the weekend of Russia’s threats near the Polish border highlighted ongoing risks to European energy security from the northeast.
Polish and allied aircraft were deployed Saturday to secure Polish airspace after Russia launched air strikes on western Ukraine close to the Polish border, according to Poland’s armed forces. This followed incidents of Russian military jets violating Estonia’s airspace on Friday and a Russian plane entering neutral Baltic Sea airspace on Sunday, as reported by Germany’s air force. The United Nations Security Council is set to meet Monday to discuss Estonia’s allegations.
Simultaneously, Ukraine intensified drone attacks on Russian energy infrastructure, while US President Donald Trump called on the European Union to cease buying Russian oil and gas.
In the Middle East, four Western countries formally recognized a Palestinian state, provoking a strong reaction from Israel and increasing regional instability.
On Friday, Brent and WTI prices dropped over 1% amid concerns about ample supply and falling demand, despite hopes that the US Federal Reserve’s first interest-rate cut of the year would stimulate consumption.
Iraq boosted oil exports following the gradual rollback of voluntary production cuts under the OPEC+ agreement, reported the country’s state oil marketer SOMO. Iraqi exports averaged 3.38 million barrels per day in August, with September shipments expected between 3.4 and 3.45 million barrels per day.
Tim Evans, writing in his newsletter Evans on Energy, stated, “Rising inventories over the past six months confirm that supply has been outpacing demand. Strategic reserves accumulated by China and the US have helped absorb the surplus, but added inventories still limit near-term upside for prices.”
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The recent rise in oil prices amid geopolitical tensions highlights Oman’s strategic advantage as an energy supplier, yet the simultaneous concerns over supply increases and demand uncertainties pose volatile risks for the sector. Smart investors and entrepreneurs should monitor geopolitical developments closely while exploring opportunities in energy diversification and infrastructure to hedge against price shocks and capitalize on shifting regional dynamics.
