Oil steadies after sharp fall, Middle East uncertainty persists
Shafaq News/On Wednesday, oil prices inched higher in early trade on uncertainty over whatmay happen next in the Middle East conflict, following a drop to their lowestlevels since early October in the previous session due to demand concerns.
Brent crudeoil futures rose 14 cents, or 0.2%, to $74.39 a barrel by 0250 GMT. U.S. WestTexas Intermediate crude futures climbed 19 cents, or 0.3%, to $70.77 perbarrel.
Oil pricestumbled more than 4% to a near two-week low on Tuesday due to a weaker demandoutlook and after a media report said Israel would not strike Iranian nuclearand oil sites, easing fears of a supply disruption.
However,concerns about an escalation in the conflict between Israel and Iran-backedmilitant group Hezbollah persist, with the U.S. on Tuesday saying it opposedthe scope of Israel's air strikes in Beirut over the past few weeks.
"Followingthe recent retracement in prices, we may expect some room for prices tostabilise in the near term, as market participants reassess furtherdevelopments on the geopolitical front," said Yeap Jun Rong, marketstrategist at IG.
"Moreclarity over China's fiscal policy awaits as well, and the lack of specificsseem to cast some uncertainties over the eventual impact on its oil demandoutlook," said Yeap.
China mayraise an additional 6 trillion yuan ($850 billion) from special treasury bondsover three years to stimulate a sagging economy, local media reported, thoughthat failed to revive sentiment in the country's stock market.
On the oildemand side, both the Organization of the Petroleum Exporting Countries and theInternational Energy Agency this week cut their forecasts for global oil demandgrowth in 2024, with China accounting for the bulk of the downgrades.
For now, themarket will be looking out for the latest U.S. oil inventory data, with theAmerican Petroleum Institute's weekly report due later on Wednesday and EnergyInformation Administration data to come on Thursday. The reports are coming aday later than normal following a federal holiday.
Analystspolled by Reuters expected crude stockpiles rose by about 1.8 million barrelsin the week to Oct. 11.
(Reuters)
