The start of a new crude trading month saw familiar concerns drive prices downward, namely: concerns over demand declines that many analysts questioned can be mitigated with the Organization of the Petroleum Exporting Countries' (OPEC) recently announced supply cuts.
Brent on Monday settled down 85 cents, or 1.08 percent, at $78.03 per barrel, and West Texas Intermediate settled down $1.03, or 1.39 percent, at $73.04.
Vandana Hari, founder of oil market analysis provider Vanda Insights, noted that "Crude seems to be under continued pressure from the OPEC+ decision" in reference to prices last week declining by 2 percent following the cartel's Thursday announcement it would deepen voluntary production cuts.
But as usual, some analysts departed from the standard narrative about market conditions: ANZ Research said in a note, "Crude oil price near $80 per barrel looks underpriced as market is in deficit and inventories are low."
ANZ added, "Further, geopolitical risks are still looming, a wider conflict in the Middle East will be a potential downside supply risk….if the U.S. tightens its sanctions against Iran and Russia and OPEC+ voluntary cuts go as per plan, this severely tightens the market balance."
In other oil news on Monday, a source with information on the matter told media that some of the most popular flag states for oil tankers (including Panama, the Marshall Islands, and Liberia) are coming under increasing pressure from backers of the price cap on Russian crude.
The U.S. and the European Union are reportedly asking these states to boost the monitoring of vessels flying their flags and ensure they are not violating the $60 cap.
Also on Monday, Dr. Sultan Al Jaber, president of the United Nations' COP28 climate summit, responded to reports that he stated during a public forum last month that there is "no science" showing a phase out of fossil fuels is required to limit global warming.
He stated, "I have said, over and over, that the phase-down and the phase-out of fossil fuel is inevitable, in fact it is essential…..and it needs to be orderly, fair, just, and responsible."