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Brent futures fell 66 cents, or 0.57%, to $115.15 a barrel amid hopes for negotiations (inbusiness.kz). However, attacks on Saudi Arabia are limiting the decline: the price remains near a six-month high. Readers in Kazakhstan should consider both factors when assessing prices: the daily decline still leaves oil at a high price.
What happened
The decline was prompted by talks held in Tehran on Monday. The prospect of a diplomatic resolution to the conflict in the Middle East eased some of the market’s concerns about oil supplies.
US crude benchmark WTI also fell: by 44 cents, or 0.43%, to $101.32 a barrel. Both benchmarks therefore declined, though by different amounts. Brent lost more in both dollar and percentage terms.
How much the price changed
When reading news about oil above $100, it helps to compare the daily change with the price itself. Brent’s 66-cent decline came with the price above $115. The word “fell” describes the direction of the move, but says nothing on its own about whether oil is cheap.
The size of the decline can be checked using two figures: the closing price of $115.15 and the drop of $0.66. Before the move, the price was $115.81: $115.15 + $0.66. Dividing $0.66 by $115.81 and multiplying by 100 gives approximately 0.57%.
How Brent compares with WTI
For WTI, the same calculation gives a price of $101.76 before the decline: $101.32 + $0.44. A drop of $0.44 from $101.76 is approximately 0.43%. Both calculations match the published percentages after rounding.
The difference between the two quoted benchmark prices is $13.83 a barrel: $115.15 − $101.32. This compares Brent and WTI prices. It does not show how much Kazakhstan receives for each barrel it sells.
Why the decline remains limited
Last week, Brent rose above $117 a barrel after a series of attacks on tankers near the Strait of Hormuz. Prices reached that level again on Monday. The latest decline should therefore be viewed in the context of recent gains that pushed the price towards six-month highs.
New attacks on Saudi Arabia are increasing uncertainty over supplies from one of the world’s key oil producers. The safety of shipping through the Strait of Hormuz poses an additional risk. Attacks on vessels are sustaining concerns about the continued flow of crude to the global market.
When prices are next updated, watch for reports on further talks and shipping safety. Diplomatic news eases supply concerns, while new attacks heighten them again. Whether prices continue to fall depends on how these factors play out.
