Oil Dips as Middle East Ceasefire Talks Continue in Qatar
Oil prices declined in the global commodity market on Thursday despite positive demand outlook in US – the world’s largest crude consumer – supported by ceasefire discussion in the Middle East conflicts.
The market weighed impacts of crude oil demand concern from Chinese and moderately stable US dollar index on energy costs, causing price swings to persist.
ICE Brent crude fell by 0.08% to $81.04 per barrel on Thursday. West Texas Intermediate (WTI) traded at $76.97 per barrel, down by 0.85%.
Both benchmarks fell on Thursday due to growing expectations of a cease-fire in the Middle East, home to a vast majority of global oil reserves, by relieving market players’ supply concerns.
According to Israeli media reports on Sunday, negotiation team will leave for Qatar on Thursday to continue talks on a Gaza cease-fire and prisoner swap deal with Palestinian factions.
A statement by Israeli Prime Minister Benjamin Netanyahu said he held ‘in-depth discussions’ Sunday on efforts to reach a prisoner swap deal with Hamas.
Meanwhile, oil prices continue to be depressed by slower-than-expected economic growth data in China, the world’s largest importer of crude oil, which raised concerns about the country’s oil demand.
The gross domestic product (GDP) of China rose by 4.7% in the second quarter of 2024, below market expectations, according to official data, which followed figures showing a softness in oil imports.
Uncertainty over the country’s oil demand fuels market players’ fears that imports and refining activity could also remain low.
Data indicates a drop in crude stocks in the US, the world’s largest oil-consuming country, limited downward price movements by suggesting that oil demand was increasing.
According to data released by the EIA late Wednesday, US commercial crude oil inventories decreased by 3.7 million barrels to 436.5 million barrels during the week ending July 19. The drop in inventory was well above the market prediction of around 2.6 million barrels.
The market prices of crude oil rose following inventory report from the EIA, while European natural gas prices rallied on the back of increased LNG buying interest from Asia
European natural gas prices saw renewed strength. EU natural gas TTF settled almost 3.2% higher on the day despite European storage continuing to edge higher.
The strength in the market has been attributed to some Asian buying interest in the spot LNG market. In the US, the EIA will release its weekly natural gas storage report today.
Expectations are that storage increased by 11Bcf over the last week, while the 5-year average for the week ending 19 July is a 31Bcf increase. FG Unveils Metering Project Teams to Combat Oil Theft
