Oil prices stabilized after falling in the past three sessions as there were signs that the war between Israel and Hamas may be contained for the time being.
Brent crude, the global benchmark, is around $88 a barrel, erasing about half of its gains since the Oct. 7 Hamas attack, while West Texas Intermediate crude is below $84 a barrel. Ta. The White House announced Tuesday that the United States and Saudi Arabia have agreed to continue diplomatic efforts to maintain stability across the Middle East, allaying concerns about major disruptions to the oil market.
Oil prices rose in the early stages of the war amid concerns that an escalation of the conflict could threaten Iranian exports and attack tankers along key shipping routes. Those concerns have allayed in recent meetings, and there are growing calls within Israel to reconsider the scope of the ground invasion of Gaza, although the risk of further unrest remains.
Vishnu Varasan, director of Asia economics and strategy at Mizuho Bank, said the series of oil price declines “may reflect reluctance toward a ground invasion of Gaza,” adding, “Iran, Lebanon, etc. “If it is included,” he said.
Away from the Middle East, President Xi Jinping has stepped up support for the Chinese economy by issuing additional government bonds and increasing the fiscal deficit ratio. The move has sparked optimism across financial markets and could boost demand in the world’s biggest oil importer.
The industry-funded American Petroleum Institute said Tuesday that U.S. crude inventories fell by 2.67 million barrels last week, according to people familiar with the data, a potential positive signal for oil. It is said that there is. However, inventory levels at our Cushing, Okla., warehouse center increased slightly. Official statistics are expected to be released later Wednesday.