Summary
- Israel and Hamas agree to Gaza ceasefire, return of hostages
- US oil product supplied highest since December 2022, EIA says
- Stalled peace talks in Ukraine underpin prices
LONDON, Oct 9 (Reuters) – Oil prices were little changed on Thursday as investors weighed a ceasefire deal in Gaza that could ease tensions in the Middle East against stalled peace talks in Ukraine that could sustain sanctions on Russia and curb its exports.
Brent crude futures were down 16 cents to $66.09 a barrel at 1146 GMT. U.S. West Texas Intermediate crude was down 18 cents to $62.37.
Get the Latest US Focused Energy News Delivered to You! It’s FREE:
Israel and Hamas both publicly endorsed the ceasefire deal and were expected to sign it around noon in the Egyptian beach resort of Sharm el-Sheikh (0900 GMT), though there was no immediate confirmation that the signing had taken place.
Israeli Prime Minister Benjamin Netanyahu’s office said the ceasefire would take effect once ratified by the Israeli government, which would convene after a security cabinet meeting scheduled for 5 p.m. (1300 GMT).
Under the deal, fighting will cease, Israel will partially withdraw from Gaza and Hamas will free hostages it captured in the attack that precipitated the war, in exchange for prisoners held by Israel.
‘WIDE-RANGING’ IMPLICATIONS FOR OIL MARKETS
“The peace agreement is a major breakthrough in recent Middle Eastern history – its implications for oil markets could be wide-ranging, from the possibility of a decrease in the Houthis’ attacks in the Red Sea to an increase in the likelihood of a nuclear deal with Iran and, eventually, the possibility for Iran to increase its crude and product exports,” Rystad Energy’s chief economist Claudio Galimberti said in a note.
Galimberti also said attempts at a ceasefire deal have fallen apart previously.
The war in Gaza has supported oil prices due to the potential risk to global supply if the fighting developed into a wider regional conflict.
Michael McCarthy, CEO of investor platform Moomoo Australia and New Zealand, said the Gaza ceasefire was unlikely to change oil supply in the Middle East as the OPEC+ producer group has not hit its increased production targets.
The group, made up of the Organization of the Petroleum Exporting Countries and allies, agreed on Sunday to a November output hike that was smaller than market expectations, easing oversupply concerns.
Prices had gained around 1% on Wednesday to reach a one-week high after investors viewed stalled progress on a Ukraine peace deal as a sign that sanctions against Russia, the world’s second-largest oil exporter, would continue for some time.
Meanwhile, total weekly U.S. petroleum products supplied, a proxy for U.S. oil consumption, rose last week to 21.99 million barrels per day, the most since December 2022, according to a report from the Energy Information Administration on Wednesday.
JP Morgan analysts said global oil demand began on a softer note in October as numerous consumption indicators, including container arrivals at the Port of Los Angeles, truck toll mileage in Germany and container throughput in China, pointed to a moderation in activity.
Global oil demand averaged 105.9 million bpd in the first seven days of October, up 300,000 bpd from last year’s level, though 90,000 bpd lower than JP Morgan’s estimates, its analysts said.
Reporting by Stephanie Kelly in London, Florence Tan in Singapore and Georgina McCartney in Houston. Editing by Mark Potter and Jane Merriman
Share This:
More News Articles
