Oil prices recover on Fed signals and geopolitical tensions
2023.11.03 10:09
© Reuters.
Oil prices, including West Texas Intermediate (WTI) and for January settlement, saw an uptick recently, breaking a three-day losing streak. The WTI settled above $82 a barrel, while Brent surpassed $86.85 a barrel. This rebound has been attributed to multiple factors, including the Federal Reserve’s signals of ending interest rate hikes and a decrease in the dollar value.
Another significant factor was US intelligence reports indicating that Russia’s Wagner Group may supply air defense weapons to Iran-backed Hezbollah. This geopolitical tension further boosted oil prices.
Despite these positive influences, crude continues to trade below pre-war levels. Fears of regional conflict disrupting oil supplies and a manufacturing contraction in China are contributing to these lower prices. An agreement between Israel, Egypt, and Hamas allowing some refugees to flee Gaza conflict zones through a Qatar-mediated deal has partially eased concerns but not enough to fully restore crude prices.
US President Joe Biden’s call for a pause in fighting hasn’t fully alleviated fears either, indicating that geopolitical tensions continue to play a significant role in oil market dynamics. The market is closely watching these developments and their potential impact on future crude demand.
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