Shafaq News/Oil prices eased on Tuesday as the top U.S. diplomat renewed efforts to pushfor a ceasefire in the Middle East and as slowing demand growth in China, theworld's top oil importer, continued to weigh on the market.
Brent crudefutures for December delivery were down 19 cents, or 0.3%, at $74.1 a barrel at0350 GMT. U.S. West Texas Intermediate crude futures for November delivery were18 cents lower at $70.43 a barrel on the contract's last day as the frontmonth.
The moreactively traded WTI futures for December , which will soon become the frontmonth, lost 14 cents, or 0.2%, to $69.9 per barrel.
Both Brentand WTI settled nearly 2% higher on Monday, recouping some of last week's morethan 7% decline, with no letup of fighting in the Middle East and the marketstill nervous about Israel's expected retaliation against Iran potentiallyleading to a disruption of oil supply.
Monday'sgains can be attributed to technical profit-taking and short covering givenoil's bearish trend with forecasts pointing towards softer demand andoversupplied oil markets, said Priyanka Sachdeva, senior analyst at PhillipNova, a brokerage firm.
U.S.Secretary of State Antony Blinken headed to the Middle East on Monday seekingto revive talks to end the Gaza war and defuse the spillover conflict inLebanon.
"Crudeoil prices have been fluctuating in response to mixed news from the MiddleEast, as the situation alternates between escalation and de-escalation,"Satoru Yoshida, a commodity analyst with Rakuten Securities.
"Themarket is expected to rise if there are clearer signs of China's economicrecovery, bolstered by Beijing's stimulus measures and improvement in U.S.economy following interest rate cuts," he said. But gains are likely to belimited by persistent uncertainty about the overall global economic outlook, headded.
China onMonday cut benchmark lending rates as anticipated at the monthly fixing,following reductions to other policy rates last month as part of a package ofstimulus measures to revive the economy.
The movecomes after data on Friday showed China's economy grew at the slowest pace sinceearly 2023 in the third quarter, fuelling growing concerns about oil demand.
China'soil-demand growth is expected to remain weak in 2025 despite recent stimulusmeasures from Beijing as the world's No. 2 economy electrifies its car fleetand grows at a slower pace, the head of the International Energy Agency said onMonday.
Still, SaudiAramco, is "fairly bullish" on China's oil demand especially in lightof the government's stimulus package which aims to boost growth, the head ofthe state-owned oil giant said on Monday.
Alsocontributing to the downward pressure on oil market was the U.S. dollarstrength driven by a gradual easing of global inflation, Phillip Nova'sSachdeva said.
A strongerdollar normally weighs on oil prices as it makes the greenback-priced commoditymore expensive for non-dollar holders to buy.
U.S. crudeoil stockpiles likely rose last week, while distillate and gasoline inventorieswere seen down, a preliminary Reuters poll showed on Monday.
(Reuters)