Oil prices were little changed on Friday and continued to maintain their weekly gains, amid ongoing tensions in the Middle East after Israel rejected a ceasefire offer from Hamas.
Brent crude futures were down 1 cent at $81.62 a barrel as of 03:34 GMT, while WTI crude futures were up 3 cents at $76.25 a barrel.
Both indicators rose nearly 3 percent in the previous session as Israeli forces bombed the southern border city of Rafah on Thursday after Netanyahu rejected a proposal to end the war in the Palestinian region. According to reports, Tel Aviv is planning to form an international alliance for the war in Gaza. Biden says he’s pushing for a pause in Gaza war
Tensions kept oil prices high; Brent and WTI are both poised for weekly gains of over 5%.
Yesterday’s move looks a bit extreme from a fundamentals perspective, and considering the oil balances, the intermittent trading we have become accustomed to recently is expected to continue.
US officials made their harshest criticism to date regarding Israel’s civilian casualties in Gaza, in Israel, which turned the focus of its attacks on Rafah.
A delegation from Hamas arrived in Cairo on Thursday to hold ceasefire talks with mediators Egypt and Qatar.
Although the conflict supported prices, there was no impact on oil production.
While non-OPEC production from Norway and Guyana is rising, Russia is exporting more crude than planned in February following drone attacks and technical outages at its refineries that could undermine its commitment to reduce sales under the OPEC+ pact.
Under the agreement with the Organization of the Petroleum Exporting Countries and its allies called OPEC+, Russia has committed to limiting its crude oil production to 9.5 million barrels per day (bpd). It is also voluntarily reducing crude oil exports by 300,000 barrels per day from the May-June average level and fuel exports by 200,000 barrels.
Deflation risks in China, the world’s largest crude oil importer, also put pressure on global oil prices.
The lower crude oil price in Asia is thought to be largely due to early weakness in Chinese stock markets and the effects of yesterday’s shocking CPI figure in China further weakening confidence ahead of the Lunar New Year celebrations.