The movement of Brent crude oil prices in 2024 tells a compelling story of market stability amidst global uncertainty.
This year, Brent crude oil futures averaged $80 per barrel, slightly lower than the $82 per barrel average in 2023.
Intraday prices fluctuated within a tight $24 range, from $68 to $93 per barrel, marking the narrowest trading band since 2019.
When adjusted for inflation, this range is the smallest since 2003.
The interplay of factors shaped this remarkable steadiness.
Strong global oil production and slower demand growth exerted downward pressure on prices, while geopolitical tensions and voluntary production cuts by OPEC+ nations lent upward support.
These opposing forces balanced the market, keeping prices within a tight window.
Early year surges amid geopolitical tensions
In the first quarter of 2024, Brent crude oil prices climbed as geopolitical risks heightened due to conflicts in the Middle East.
While the Israel-Hamas conflict didn’t directly impact oil supplies, fears of broader regional instability pushed prices upward.
Compounding this, Yemen’s Houthi militia targeted vessels in the Red Sea, disrupting trade routes and forcing tankers to reroute.
Peaks and declines in a dynamic market
April marked the year’s high point, with Brent crude closing at $91 per barrel.
However, prices trended downward through the remainder of the year.
OPEC+ announcements in June and September of delayed production hikes caused brief price increases, but these were quickly followed by declines.
Renewed tensions in the region, including risks of conflict between Israel and Iran, led to short-lived spikes in oil prices.
The second half: economic concerns weigh in
Economic challenges dominated the latter half of 2024.
Concerns over oil consumption, particularly in China’s diesel and gasoline markets, exerted significant downward pressure.
Global oil consumption growth slowed to less than 1 million barrels per day (b/d), well below the pre-pandemic average of 1.5 million b/d.
A narrow path forward
September saw Brent crude oil prices fall to their lowest point of the year at $69 per barrel.
The inflation-adjusted trading range for 2024 remains the narrowest in over two decades, reflecting a year defined by balance rather than extremes, with information from EIA .
This year’s oil market demonstrated resilience amidst uncertainty, offering valuable insights into the delicate equilibrium shaping global energy markets.
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