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Tuesday, October 13, 2026
Oil outlook clouded by Middle East risks and returning supply
By Vijay Valecha in 'Century in News'
Vijay Valecha, Tue, Oct 13, 2026 Khaleej Times
Traders are weighing geopolitical disruptions against weaker demand forecasts and the prospect of additional Russian fuel exports into global marketsOil markets are entering a period of heightened uncertainty as geopolitical tensions in the Middle East compete with signs that additional supplies could return to global markets, analysts say.
Crude prices have eased from recent highs, but experts warn that risks to shipping routes and energy infrastructure continue to underpin market volatility.
Brent crude has recently traded near $105-$107 a barrel, while West Texas Intermediate hovered around $92-$93. Analysts say the next direction for prices will depend on whether improving supply conditions outweigh lingering geopolitical threats.
The prospect of increased Russian diesel exports, coupled with hopes of a Russia-Ukraine energy ceasefire, has raised expectations that some pressure on global fuel markets could ease. At the same time, concerns remain over tanker movements through the Strait of Hormuz and attacks linked to regional conflicts.
Analysts also point to weakening demand forecasts as a potential brake on prices. OPEC has reportedly lowered its expectations for 2026 oil demand growth, while the International Energy Agency has projected lower global consumption.
However, analysts at forex.com argue that easing crude prices could help reduce inflation concerns that have weighed on global financial markets.
“The real energy shock is no longer simply about a supply deficit, but a ‘logistics premium’ imposed on every barrel that transits,” said Vijay Valecha, Chief Investment Officer at Century Financial.
Valecha said investors are increasingly focused on the cost and risks of moving oil through global supply chains, including shipping delays, insurance costs and security concerns.
“Just because the market has found ways to keep oil flowing doesn’t mean it can handle another major disruption,” he said. “That’s the risk the market may be underestimating.”
For UAE investors, analysts say the outlook will depend not only on supply and demand fundamentals but also on whether regional tensions ease and whether major economies can avoid a deeper slowdown. Until then, oil prices are likely to remain driven as much by geopolitics and logistics as by traditional market fundamentals.
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