403
Sorry!!
Error! We're sorry, but the page you were
looking for doesn't exist.
Oil rates climb amid tensions in Middle East
(MENAFN) Oil prices saw a modest increase on Monday, driven by ongoing conflicts in the Middle East and rising expectations of economic activity in the world’s largest oil consumers, the United States and China. Despite the upward trend, potential plans by Saudi Arabia to boost oil production in December have tempered further price increases.
As of 10:40 a.m. local time (0740 GMT), the international benchmark Brent crude rose by 0.02 percent, reaching USD71.95 per barrel, up from the previous session's close of USD71.93. Conversely, the U.S. benchmark West Texas Intermediate (WTI) experienced a slight decline, falling 0.16 percent to USD68.32 per barrel after closing at USD68.43 in the prior session.
Analysts are keenly awaiting upcoming employment data, which may shed light on the U.S. Federal Reserve's future policy directions and provide a clearer picture of the U.S. economy. Recent indicators of lower-than-expected inflation have bolstered expectations that the Fed may continue to prioritize labor market support and potentially implement further interest rate cuts. There is a strong belief that the Fed could reduce rates by 75 basis points by year-end, with a 54 percent likelihood of a 50 basis point cut as early as November. Such cuts are anticipated to enhance economic activity and, consequently, oil demand.
In addition to U.S. developments, measures taken by China to stimulate economic mobility are expected to positively influence its oil demand. Recent economic incentives introduced by the Chinese government, including plans for banks to lower mortgage interest rates, are already having a favorable impact on market sentiments. This dual focus on U.S. and Chinese economic dynamics is fostering optimism in oil markets, contributing to the recent rise in prices.
Overall, while geopolitical tensions continue to play a significant role in shaping oil prices, underlying economic indicators and policy shifts are also critical factors influencing the market's direction.
As of 10:40 a.m. local time (0740 GMT), the international benchmark Brent crude rose by 0.02 percent, reaching USD71.95 per barrel, up from the previous session's close of USD71.93. Conversely, the U.S. benchmark West Texas Intermediate (WTI) experienced a slight decline, falling 0.16 percent to USD68.32 per barrel after closing at USD68.43 in the prior session.
Analysts are keenly awaiting upcoming employment data, which may shed light on the U.S. Federal Reserve's future policy directions and provide a clearer picture of the U.S. economy. Recent indicators of lower-than-expected inflation have bolstered expectations that the Fed may continue to prioritize labor market support and potentially implement further interest rate cuts. There is a strong belief that the Fed could reduce rates by 75 basis points by year-end, with a 54 percent likelihood of a 50 basis point cut as early as November. Such cuts are anticipated to enhance economic activity and, consequently, oil demand.
In addition to U.S. developments, measures taken by China to stimulate economic mobility are expected to positively influence its oil demand. Recent economic incentives introduced by the Chinese government, including plans for banks to lower mortgage interest rates, are already having a favorable impact on market sentiments. This dual focus on U.S. and Chinese economic dynamics is fostering optimism in oil markets, contributing to the recent rise in prices.
Overall, while geopolitical tensions continue to play a significant role in shaping oil prices, underlying economic indicators and policy shifts are also critical factors influencing the market's direction.
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.
Most popular stories
More Story
Comments
No comment