'Diplomatic' balance in oil

Oil prices have been stabilized by diplomatic efforts to end the US-Iran conflict and new attacks in the region.

Oil started the first day of the new week with a horizontal course after the biggest weekly decline since April 2020.

Brent oil traded around $98 per barrel after losing more than 16 percent last week. West Texas Intermediate (WTI) crude oil remained close to $91.

Crude oil prices have fallen sharply from a six-month high in late October after a landslide victory for Democrats in the US midterm elections strengthened expectations that there would be no serious escalation in the conflict.

CNN had quoted Trump as saying that the likelihood of him ordering new strikes if negotiations made significant progress was "extremely low."

Jorge Leon, head of geopolitical analysis at Rystad Energy AS, stated that intermittent talks that have been going on for months have failed to produce a solution to the conflict that is blocking energy exports from the Persian Gulf.

Stating that the Democrat victory in the USA may not make a breakthrough more likely, Leon said, "More pressure for an agreement does not necessarily mean that an agreement is closer. If we see a re-escalation, most of last week's oil price decline could quickly reverse."

Meanwhile, tension continued in the Middle East. According to the United Kingdom Merchant Marine Operations (UKMTO), a tanker leaving the Strait of Hormuz over the weekend was reportedly hit with ammunition of unknown origin.

Additionally, in the region, Iran-backed Houthis in Yemen damaged the offices of state oil giant Saudi Aramco in Riyadh with an attack. This led OPEC member Saudi Arabian forces to retaliate by destroying two missile launchers.