Oil Prices Up on Mideast Tensions and US Rate Cut

23 Sep 2024 , 10:06 AM

Oil prices edged higher in early Monday trading due to concerns about potential supply disruptions in the Middle East and expectations that the recent US interest rate reduction will boost demand.

• Brent crude futures for November rose 20 cents, or 0.2%, to $74.37 a barrel.
• US crude futures for November gained 22 cents, or 0.3%, to $71.22 a barrel.

Both contracts climbed on Friday, supported by the lower US interest rate and a temporary supply dip following Hurricane Francine. This marks the second consecutive week of oil price increases.

The rise in prices comes amid heightened tensions between Israel and Hezbollah, a Lebanese militia reportedly backed by Iran. On Sunday, the groups exchanged heavy fire, raising worries about a potential escalation in the ongoing conflict.

The recent developments add to existing concerns about global oil supplies.

India’s reliance on imported crude oil increased by 6.4% in August compared to the same month last year, while domestic oil production fell by 2.9%, according to the most recent report from the Petroleum Planning & Analysis Cell (PPAC) under the Ministry of Petroleum & Natural Gas. This trend highlights the rising pressures on India’s energy security as global oil prices rise.

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