Benchmark Brent crude oil futures prices averaged $80 per barrel (b) in 2024, $2/b less than in 2023. Intraday prices stayed within a $24/b range, between $68/b and $93/b (after rounding), which was the narrowest trading range since 2019. Adjusting the trading range for inflation, last year was the narrowest since 2003. Strong global growth in production of oil and slower demand growth put downward pressure on prices, while heightened geopolitical risks and voluntary production restrictions among OPEC+ members supported them. These offsetting factors kept oil prices within a narrow range.

During the first quarter of 2024, Brent oil prices generally rose due to heightened geopolitical risks largely associated with the growing Middle East conflict. Although fighting between Israel and Hamas did not affect regional supplies, Middle East conflicts increase the risk of regional supply disruption and can increase oil prices. In addition, Yemen-based Houthi militia began attacking vessels entering the Red Sea in late 2023 and early 2024, causing major trade disruptions as ships, including oil tankers, re-routed to avoid the area.

Front-month Brent crude oil prices were highest in 2024 during April, closing at $91/b. Prices generally declined through the remainder of 2024, with smaller price rallies driven by OPEC+ announcements in June and September regarding delayed production increases. Further conflict flare-ups and risks of armed conflict between Israel and Iran led to short-lived price increases.

Following brief increases, prices often declined quickly. Economic weakness and concerns about oil consumption—particularly regarding trends in consumption of diesel and gasoline in China—weighed on prices during the second half of 2024. We estimate global oil consumption grew by less than 1 million barrels per day (b/d) in 2024, less than the annual average growth in the decade before the pandemic of 1.5 million b/d, according to data in our December Short-Term Energy Outlook.

In early September, crude oil prices declined to their lowest point of the year at $69/b. The trading range of Brent crude oil prices in real (inflation-adjusted) terms in 2024 was the narrowest in more than 20 years.

Source: EIA