Deutsche Bank analysts note that Brent Oil has stabilised after recent conflict-driven spikes, with prices briefly falling back towards $100 as hopes grew for resumed flows through the Strait of Hormuz. They highlight that International Energy Agency comments on potential stockpile releases and partial resumption at UAE’s Fujairah terminal have helped calm fears of a severe stagflationary shock.

Oil stabilises as supply fears cool

"The sun has shone a little brighter on markets over the last 24 hours, with oil prices stabilising as hopes mounted for a resumption of oil flows through the Strait of Hormuz. So that helped to ease fears about a wider stagflationary shock, with Brent crude (-2.84%) falling back to $100.21/bbl, whilst the 6-month future (-2.64%) fell to $83.40/bbl."

"But even as there was no obvious sign yet of an off-ramp, we did see oil market pressures that had dominated yesterday’s Asia session ease during European and US hours. One more encouraging headline came from the International Energy Agency, with their Executive Director saying they could release more stockpiles if needed."

"And while UAE’s Fujairah oil export terminal was hit by an Iranian strike earlier on Monday, it partially resumed operations later in the day. Investors were also pondering the potential for some countries’ vessels to pass through the straits after a few tankers exited the Gulf over the weekend, though this represented only a very small trickle compared to normal volumes of around fifty tankers a day."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)