Oil Prices Bumpy After Western Strikes On Syria

Oil prices fell on Monday morning in Asia

Investing.com - Oil prices fell on Monday morning in Asia as markets opened the week cautiously following western air strikes in Syria over the weekend.

Crude Oil WTI Futures for May delivery were trading at $66.83 a barrel in Asia at 11:00PM ET (03:00 GMT), down 0.83%. Brent Oil Futures for June delivery, traded in London, were down 1.02% at $71.84 per barrel.

Shanghai Crude Oil WTI Futures for September delivery were down 0.28% at 424.90 yuan ($67.63) per barrel at 11:00PM ET (03:00 GMT) on Monday.

In retaliation for a suspected poison gas attack in Douma on April 7, the U.S., France and Britain launched 105 missiles on Saturday, targeting what they said were three chemical weapons facilities in Syria.

Although Syria is not a key oil producer, the wider Middle East is the world’s most important crude exporter and tension in the region tends to trigger concerns that oil supplies will be disrupted.

The supply restraint led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia has supported oil markets considerably. OPEC said the global oil inventory surplus is close to evaporating, having shrunk by nine-tenths since the start of 2017 due to the supply cuts and rising demand.

However, a rise in U.S. oil drilling activity is putting pressure on oil markets. U.S. energy companies added seven oil rigs drilling for new production in the week to April 13, bringing the total to 815, the highest since March 2015.

Despite this, healthy demand and conflict in the Middle East continue to prop up prices.

OPEC’s pact to reduce crude output runs until the end of 2018 but there is growing confidence that the cooperation will be extended. The group will meet in June to decide on its next course of action.