Oil Prices Rise On Middle East Tensions, OPEC+ Meeting In Focus
Oil prices rose in Asian trade on Thursday as concerns over Middle Eastern supplies persisted amid increasing military action in the Redanticipation of an OPEC+ meeting also kept traders cautious.
Markets Federal Reserve shot down expectations for a March rate cut.the prospect of higher-for-longer U.S. interest rates, after the
The U.S. targeted several unmanned drones in Western Yemen that were being prepared for launch, media reportsmove coming just a day after a deadly drone strike against a U.S. base in Jordan.
The strike pointed tode-escalation in the Middle East conflict, which has disrupted shipping routes through the Red Sea and fueled fears of delayed oil deliveries in Europe and Asia.
Concerns over supply disruptions were a keysupport for oil prices in January, helping them break three straight months of losses.
Both contracts rose between 4% and 5% in January.
Rate-cut uncertainty, China weakness weighcrude
Any major rebound in oil prices was held back by dollar, after the Fed said it was in no hurry to begin interest rates.in the
While Fed Chair Jerome Powell flagged persistent resilience in the U.S. economy, the prospect of higher-for-longer interest rates still bodes poorly for demand in the world’s largest fuel consumer.
The dollar rebounded after Powell’s comments, weighing on oil prices.
Weak economic signals from China also factored into concerns over slowing demandthe world’s largest oil importer.
Official purchasing managers index data for January showed manufacturing activity remained in contraction, pointing to improvement in a sluggish economic recovery.
On the supply front, data showing an unexpected build in U.S. oil inventories also indicated that U.S. production was recovering from a cold snap earlier in disrupted output in several parts of the country. U.S. domestic oil production back to record levels in the prior week.
OPEC+ meeting on tap, no changes expected
The Organization of Petroleum Exporting Countries and hold a meeting of the Joint Ministerial Monitoring Committee later in the day- the bloc’s first major meeting of 2024.(OPEC+) is set to
But Reuters reported that the meetingunlikely to result in any
Underwhelming production cuts from OPEC+ in late 2023 were a key point of contention for oilmove pointed to less tight markets in 2024 than initially expected.
The cartelto have limited headroom to cut production further and support oil prices.