Adedapo Adesanya
By Adedapo Adesanya
Crude oil prices eased on Tuesday as markets worried less about potential supply disruptions from the Middle East conflict and on data showing rising output from the Organisation of the Petroleum Exporting Countries (OPEC) and the United States.
The Middle East conflict has been the major driver of oil price movement in the last weeks and yesterday, the price of Brent lost 4 cents to close at $87.41 per barrel as the US West Texas Intermediate (WTI) went down by $1.29 to finish at $81.02 per barrel.
Recently, a Hamas spokesman said the group would release a number of foreign captives in the coming days, as Israel’s Prime Minister, Mr Benjamin Netanyahu, dismissed calls for a halt to fighting to ease a humanitarian crisis, as Israeli forces attacked Hamas in the network of tunnels under the Palestinian exclave.
While Middle East developments have yet to affect oil, as the ground invasion intensifies, the risk of involvement from Iran rises, fueling tight supply concerns.
Investors remained wary of the potential for other countries to enter the conflict.
Markets will be looking to plans by OPEC+ for production levels with members next scheduled to meet in late November.
On Tuesday, crude output rose by 180,000 barrels per day in October, according to a Reuters survey, driven principally by Nigeria and Angola.
OPEC and its allies known as OPEC+, led by Saudi Arabia and Russia, cut production by 1.3 million per day earlier this year and in September extended the reduced production level through the end of the year.
Weaker manufacturing and non-manufacturing activity data in China stoked fears of slowing fuel demand from the world’s second-largest oil consumer.
Euro zone inflation in October was at its lowest level in two years, falling to 2.9 per cent from 4.3 per cent in September, according to Eurostat’s flash estimate. That means the European Central Bank (ECB) is unlikely to hike interest rates anytime soon.
There will also be expectations of decisions at the US Federal Reserve meeting ending on Wednesday.
Analysts expect the US central bank to hold rates steady.
Crude oil inventories in the US rose by 1.347 million barrels for the week ending October 27, according to the American Petroleum Institute (API), after a 2.668-million-barrel dip in crude inventories in the week prior, API data showed.
API data shows a net draw in crude oil inventories in the world’s largest oil producer of 1.33 million barrels so far this year.
The official data from the US Energy Information Administration (EIA) will be released later on Wednesday.
