On Thursday, the price of the oil barrel fell below the $100 mark for the first time since the war in Ukraine began on February 24.

The price of a barrel of Brent North Sea oil for September delivery fell 0.47% to close at $99.10.

As for the barrel of American West Texas Intermediate (WTI), with a deadline set in August, it fell by 0.53%, to 95.78 dollars.

The price went back up on Friday after a US official told sources that an immediate Saudi oil output boost is unlikely to take place. 

Brent crude for September delivery rose about 76 cents to a set price of 99.86$, whereas WTI crude increased 29 cents to $96.06.

As a consequence of this, the US central bank is expected to act less aggressively with the rise of interest rates.

Geopolitical factors

Saudi Arabia, the world's largest oil exporter, more than doubled in the second quarter its imports of Russian fuel oil used to fuel its power plants in order to preserve its stocks of crude for export and to meet the strong demand linked to the summer period. 

Read more: Oil prices up 2% as UAE, Saudi Arabia approach max-out on oil output

Russia, on the other hand, has been soaring in its oil exports. Despite sanctions imposed by the West, Russia ingeniously managed to find new markets for its oil and petroleum products in China, India, and South America.

China also has a hand in price changes. The country is the world’s leading oil importer and the second-largest consumer after the US. Therefore, a decrease in demand is highly impactful to fluctuations in oil prices. 

“The spread of Covid in China is the most bearish item affecting the market,” said Andy Lipow, president at Lipow Oil Associates. “If [Covid] spreads throughout China resulting in a significant number of lockdowns, the impact on oil markets could be substantial.”

Read more: Oil prices hit $120 a barrel, depicting supply shortages