Singapore, Oct. 29, 2024 – Oil steadied after tumbling the most in more than two years on Monday, as the market focused on the prospect for easing hostilities in the Middle East and upcoming US economic data.
Brent edged higher toward $72 a barrel after plummeting 6.1% in the previous session, while West Texas Intermediate was below $68.
Israel signaled it was open to a short truce in Gaza in exchange for the release of a small number of hostages, following a retaliatory strike on Iran over the weekend that spared the OPEC producer’s oil infrastructure.
A slew of economic data from the US this week, including on growth and employment, should give clues on the Federal Reserve’s rate-cut path.
The latest developments in the Middle East have unwound a war premium for oil and put weak fundamentals back into the spotlight — notably poor Chinese demand growth and plentiful supply.
The market is heading into a crucial period, with a tight US presidential election looming, and OPEC+ planning to start unwinding voluntary production cuts from December.
“With the prospects of Iranian oil facilities being left out of Israel’s military plans,” supply-demand balances are becoming more influential again as a near-term price driver, said Chris Weston, head of research at Pepperstone Group Ltd. in Melbourne. (Bloomberg)
