Oil prices rose nearly 1% Thursday after Israel reported ceasefire violations with Hezbollah, heightening Middle East tensions.
Israeli military spokesperson Avichay Adraee reported on X that suspects breached the ceasefire in southern Lebanon using vehicles.
Brent crude recovered from a two-day slump, reaching $72.90 a barrel in European trading by midday.
The truce, initiated Wednesday, aimed to end 14 months of border conflict but now faces significant challenges.
Residents along the Israel-Lebanon border have been advised to avoid returning, reflecting concerns about ongoing instability.
OPEC+ Meeting Delayed Amid Rising Cohesion
OPEC+ postponed its oil policy meeting to December 5, 2024, from December 1, accommodating the Gulf Summit in Kuwait.
Analysts expect discussions to center on extending production cuts, given persistently low prices and delayed output increases.
Goldman Sachs analyst Daan Struyven noted growing compliance with cuts, signaling improved cohesion within the OPEC+ alliance.
The bank predicts gradual production increases beginning April 2025, with Brent crude peaking at $78 per barrel in June.
Market Trends and Long-Term Outlook
US data shows crude oil and gasoline inventories at five-year lows, heightening short-term supply concerns.
Goldman Sachs forecasts Brent crude could reach the mid-$80s by 2025 if Iran’s supply decreases by 1 million barrels daily.
The bank expects oil demand to grow for a decade, driven by emerging markets and slow decarbonization in aviation and petrochemicals.
Geopolitical tensions and OPEC+ strategies are shaping the short-term market, while energy transitions influence long-term demand.
