Oil Prices Fall to Lowest Level in Over a Month

Oil prices fell for the second consecutive session on Monday, reaching their lowest level in more than a month. Investors overlooked President Joe Biden’s decision to end his re-election bid, focusing instead on rising inventories and signs of weak demand.

Brent crude futures fell 0.28% to $82.40 per barrel, the lowest since June 11. U.S. West Texas Intermediate (WTI) futures for August delivery, expiring Monday, dropped 0.44% to $79.78 per barrel, also a one-month low. WTI futures for September delivery fell 55 cents to $78.09.

Biden ended his re-election campaign on Sunday, endorsing Vice President Kamala Harris as the Democratic contender to face Republican Donald Trump in the November elections.

Traders reacted calmly to Biden’s decision and ignored escalating tensions in the Middle East, according to U.S. fuel distributor TACenergy. Market participants focused on weak technical prospects, ample inventories, and sluggish demand.

While the oil market is tight now, it is expected to balance in the fourth quarter and reach a surplus in 2025, leading Brent prices to a mid-to-high $70 range next year, according to Morgan Stanley analysts.

In the Middle East, Israeli fighter jets struck Houthi military targets near Yemen’s Hodeidah port on Saturday, killing at least six people. The Houthis announced on Sunday they would continue attacking Israel, disregarding any engagement rules.

Meanwhile, China, the world’s largest oil importer, surprised markets by cutting a short-term benchmark interest rate to stimulate its economy, but the move failed to support oil prices.