The decline followed a frantic Friday rally that saw Brent touch $117 after Houthi attacks on Saudi facilities rattled the Gulf— the first spike in the week.
WTI settles at $101.5, down 1.71%, while Brent trades at $115.1, a 1.41% drop. Over the last seven days, Brent has gained 6% and WTI 2.3%, keeping both above the 12‑month average of roughly $90.
Geopolitical jitters remain the engine of the rally. Houthi claims of hitting a Saudi airport and oil sites were followed by Saudi interceptions of missiles and drones, keeping the Strait of Hormuz a primary risk vector. “The risk premium is still very high,” said Ajit Mishra, SVP‑Research at Religare Broking.
On the policy front, the market is watching the Federal Reserve’s upcoming decision closely. Any dovish tone could lift sentiment, while a hawkish stance might tighten the rally. Analysts also note that the International Energy Agency’s potential release of strategic reserves and the G7’s extra 100 million‑barrel program are still untested in the market.
Looking ahead, traders will be keen on the American Petroleum Institute and EIA’s weekly inventory figures, as well as Cushing storage data. If the Fed signals a pause and inventories show a draw, we could see a pullback; conversely, continued de‑escalation fears or a supply shock could push prices toward the $120 mark.
In short, oil remains a bulls‑and‑bears battle: geopolitical volatility keeps the risk premium inflated, but any sign of de‑escalation could trigger a sharp correction. The next market move hinges on Fed policy, inventory data, and the Gulf’s security trajectory.