# Oil Pares Gains After Strongest Weekly Rise in Over a Year

*Oil markets are navigating a complex mix of factors, including profit-taking, geopolitical tensions, and OPEC's production strategy. While the risk of direct impacts on oil supply from the Middle East remains limited, the ongoing tensions could continue to weigh on market sentiment.*

By [Investoor](https://paragraph.com/@investoor) · 2024-10-07

---

![](https://storage.googleapis.com/papyrus_images/270349860da60fec7d0e00b80163783d.webp)

### Key Points:

* * *

*   Oil prices pulled back on Monday after the largest weekly rise in over a year.
    
*   Brent crude futures fell 0.5% to $77.62 per barrel; WTI crude slipped 0.5% to $74.03 per barrel.
    
*   Last week saw Brent and WTI gain over 8% and 9%, respectively, due to Middle Eastern tensions.
    
*   Geopolitical risks involving Israel, Hezbollah, and Iran weigh on market dynamics.
    
*   OPEC+ maintains output policy but plans to increase production from December.
    

* * *

### Oil Market Overview:

![](https://storage.googleapis.com/papyrus_images/bab90ebc3bbdba047f5f317fcc6a74f5.webp)

Source: [Investing.com](http://Investing.com)

**Oil prices** fell in early trade on Monday following a surge last week. **Brent crude futures** dropped **43 cents**, or **0.5%**, to **$77.62 per barrel**, while **U.S. West Texas Intermediate (WTI) crude futures** slipped **35 cents**, or **0.5%**, to **$74.03 per barrel**. The **Brent contract** rose over **8%** last week—its biggest weekly gain since January 2023. Meanwhile, the **WTI contract** increased **9.1%**, marking its largest weekly increase since March 2023.

![](https://storage.googleapis.com/papyrus_images/281055372addc9560d0e733229c71954.webp)

Source: [Investing.com](http://Investing.com)

Independent market analyst **Tina Teng** suggested that the decline could be attributed to **profit-taking** following the substantial surge. However, she also highlighted that geopolitical tensions involving **Israel, Hezbollah, and Iran** are playing a significant role in influencing oil prices.

* * *

### Middle Eastern Geopolitical Impact:

The market remains on edge amid heightened geopolitical tensions in the Middle East. Over the weekend, **Israel bombed Hezbollah targets** in **Lebanon** and **Gaza** ahead of the one-year anniversary of **Hamas' attacks on Israel**. In response, Israel's defense minister suggested that "all options were open" for retaliation against **Iran**.

Last week, **Iran launched missile attacks on Israel**, prompting concerns about further regional conflict. **Israeli police** also reported that **Hezbollah rockets** had hit **Haifa**, Israel's third-largest city.

Despite these tensions, **ANZ Research** noted that the impact on oil supply has been relatively limited. The likelihood of **direct attacks on Iran's oil facilities** is seen as low, given potential backlash from international partners.

* * *

### OPEC+ Outlook:

**OPEC and its allies**, including Russia and Kazakhstan, have significant spare oil capacity. This could help offset any potential disruptions in oil supply. OPEC currently has **7 million barrels per day** of spare capacity, providing a buffer against unexpected supply shocks.

At their **October 2 meeting**, **OPEC+** chose to keep their current output policy unchanged, with plans to start increasing production in December. This decision reflects OPEC's strategy of managing output to maintain market stability amidst weak global demand.

* * *

### Conclusion:

Oil markets are navigating a complex mix of factors, including **profit-taking**, **geopolitical tensions**, and **OPEC's production strategy**. While the risk of direct impacts on oil supply from the Middle East remains limited, the ongoing tensions could continue to weigh on market sentiment. The potential for increased production from **OPEC+** in December will also be a key factor to watch in the coming weeks.

---

*Originally published on [Investoor](https://paragraph.com/@investoor/oil-pares-gains-after-strongest-weekly-rise-in-over-a-year)*
