Oil prices retreated today, giving up some of the gains recorded last week due to increasing fears of supply disruptions following an attack on export facilities in Saudi Arabia, the largest oil exporter in the world.
We must take into consideration that oil prices have increased recently amid expectations of an imminent global economic recovery, with a majority of the advanced economies distributing the coronavirus vaccines. The increase in oil prices can also be attributed to the US Senate's recent approval for a stimulus package amounting to $1.9 trillion and a possible decline in oil stocks within the United States, the largest consumer of oil in the world.
Brent crude futures fell by 0.7% in May to $67.78 from levels of $69, while WTI fell by 0.8% in April to $65.53.
The main reason behind the decline in oil prices is the concerns over the possibility of a rise in the US dollar in the coming period, which will increase pressure on the performance of commodities, especially after US Treasury Secretary Janet Yellen indicated on Monday that the Covid-19 aid package presented by President Joe Biden worth 1.9 trillion dollars will provide enough resources to fuel a "very strong" US economic recovery. The House of Representatives has yet to pass the Senate's version of the package.