Oil declines with Blinken’s Middle East visit
Oil fell as the United States tried to broker a peace deal between Israel and Hamas that would ease geopolitical tensions in the Middle East.
While Brent crude oil was trading below $89 per barrel after gaining 2.5 percent in value last week, US crude oil fell to $83. US Secretary of State Antony Blinken will accelerate efforts to achieve a ceasefire in Gaza during his visit to the region. The White House said it agreed to listen to Israeli concerns and delay invading Rafah until Israel meets with the Americans.
Crude oil has risen this year due to OPEC+ supply cuts and rising tensions in the Middle East, the source of about a third of the world’s oil. Meanwhile, changing expectations for U.S. monetary policy are weighing on the demand outlook, and investors will be watching Wednesday’s Fed meeting to gauge expectations for a rate cut this year.
“Geopolitical risks have decreased significantly,” said Warren Patterson, head of commodity strategy at ING Groep NV in Singapore.
Russia attacked Ukraine over the weekend, targeting natural gas infrastructure and other targets. Kiev responded with drones targeting an oil refinery in the Krasnodar region, while state news agency Tass reported that the Slavyansk plant had partially suspended operations due to the fire.