Oil prices have risen slightly following the ousting of Syrian President Bashar al-Assad, but the broader reaction has been muted.
Brent crude has increased by 1.15% to US$71.94 per barrel, while West Texas Intermediate has risen 1.41% to US$68.15 per barrel on Monday. The shift follows three consecutive sessions of declines for both benchmarks.
While Syria is not a major oil producer—pumping only 40,000 barrels per day compared to over 600,000 barrels daily in the early 2000s—its location near key oil-producing nations like Iraq and Saudi Arabia has added some geopolitical risk premium to the market. Analysts noted that the fall of Assad, who was long supported by Russia and Iran, might have broader implications for the region’s political stability.
Traders appeared more focused on other factors, particularly signals from China. Beijing’s Politburo announced plans to adopt a “moderately loose” monetary policy, marking its first shift of this kind since 2008. The news drove expectations of increased oil demand from the world’s largest crude importer. Colin Cieszynski, chief market strategist at SIA Wealth Management, stated that China’s policy shift was a more significant driver of oil prices than Syria’s political upheaval.
On broader financial markets, reactions were mixed. Germany’s DAX index fell 0.19%, while France’s CAC 40 rose 0.72%, and Britain’s FTSE 100 gained 0.52%. Asian markets were more volatile, with Tokyo’s Nikkei 225 up 0.18%, but South Korea’s Kospi fell 2.78% amid political uncertainty tied to President Yoon Suk Yeol’s impeachment-related issues.
While Syria’s collapse adds a layer of uncertainty, traders remain focused on global oil supply and demand. Rising production from non-OPEC+ producers like the United States and Brazil, along with OPEC+’s decision to delay production hikes until mid-2024, have kept market pressures balanced for now.