Oil dips again in early Asian trade

26 Feb 2024 , 10:38 AM

Early Asian trading on Monday saw a further decline in oil prices from the previous session. At the end of the week, oil prices had dropped 2-3% due to market concerns that inflation that was stronger than anticipated may postpone U.S. interest rate cuts.

U.S. West Texas Intermediate (WTI) crude prices slid 33 cents to $76.16 barrel, while Brent crude futures fell 34 cents to $81.28 barrel.

The Israel-Hamas conflict has not substantially reduced the supply of oil, despite the Houthis, who are affiliated with Iran, continuing their attacks on ships in the Red Sea.

The broad parameters of a hostage agreement were reached by negotiators from the United States, Egypt, Qatar, and Israel during discussions in Paris, but further discussions are ongoing, White House national security advisor Jake Sullivan told CNN on Sunday. Benjamin Netanyahu, the prime minister of Israel, stated that it was still unclear if an agreement would be reached.

The morning’s slide added to those from last week, when WTI dropped over 3% and Brent dropped over 2% as a result of reports that an increase in inflation would cause the U.S. to postpone interest rate cuts by two months. 

The U.S. Energy Information Administration said last week that during the week ending February 16, oil stocks had increased by 3.5 million barrels to 442.9 million barrels. This contrasted with the 3.9-million-barrel increase that analysts had predicted in a Reuters poll.

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