Oil prices fall to $72 per barrel as concerns over Syria’s instability ease

Global oil prices declined on Tuesday as fears of disruption from the political upheaval in Syria subsided, shifting market focus to broader economic factors.

Brent crude dropped by 0.11% to $72.06 per barrel, while US West Texas Intermediate (WTI) crude fell 0.20% to $68.23 per barrel at 09:50 WAT. Both benchmarks had recorded gains of over 1% on Monday.

The overthrow of Syrian President Bashar al-Assad by rebel forces, who seized Damascus on December 8, marked the end of his 24-year regime.

The new leadership has begun steps to stabilise the country, reopening banks and the oil sector.

While Syria is not a major oil producer, its strategic alliances with Russia and Iran and its geopolitical significance raised concerns about potential regional instability.

Markets are now turning their attention to the upcoming US Federal Reserve meeting on December 17-18, with expectations of a 25 basis point interest rate cut. Traders are also monitoring inflation data due this week, which could influence the Fed’s decision.

Meanwhile, reports of China adopting a more accommodative monetary policy next year to boost its economy – the first such move in 14 years – provided some optimism in the oil market.

Despite ongoing volatility, analysts suggest the immediate risks to oil supplies from Syria’s political transition appear contained.