Oil prices changed minimally on Tuesday ahead of an OPEC+ meeting scheduled for later in the week, at which the group’s members will set production policy along with data on US economic growth.
International benchmark Brent crude was trading at $82.84 a barrel at 10.12 a.m. local time (0712 GMT), down 0.05 percent from the previous session’s closing price of $82.88 a barrel.
US benchmark West Texas Intermediate (WTI) meanwhile was trading at $78.69 per barrel, up 0.18 percent from the previous session’s closing price of $78.55 per barrel.
Uncertainty over the timing of the first interest rate cut by the US Federal Reserve (Fed) is fuelling demand concerns in the oil market.
Recent data shows a partial improvement in consumer confidence in the US, the world’s largest oil consumer. The probability that the Fed will cut interest rates for the first time in September is 50%, 63% in November and 82% in December.
Market participants will focus on the US Federal Bank’s (Fed) Beige Book and economic growth data to be released this week. They will also be watching inflation figures and comments from Fed officials to gauge the bank’s future economic policy.
The world’s largest oil producers will meet on June 2. At the next meeting of OPEC+, led by Saudi Arabia and Russia, the group will discuss whether to extend a voluntary 2.2 million barrels a day production cut for the second half of the year.
Low interest rates caused the US dollar to lose value against other currencies, falling 0.12 per cent to 104.390, reducing the cost of oil for consumers paying in other currencies while boosting investor demand for oil.
Hostilities in the region continue
Meanwhile, in the Middle East, where major oil producers and trade routes are located, regional tensions remain and are weighing on oil prices.
Iran-backed Houthis in Yemen announced that they had struck two US warships and three vessels in the Red Sea and Indian Ocean on Monday, a day after the US Central Command (CENTCOM) announced the destruction of a Houthi-owned drone in the Red Sea.
According to Palestinian news agency WAFA, the Israeli military continues to attack the town of Rafah in the southern Gaza Strip, despite calls by the International Court of Justice (ICJ) and international pressure on May 24 to halt attacks on Rafah.
Over the weekend, the death toll from the Israeli attack on a camp of displaced Palestinians in the town of Rafah rose to 45.
