HOUSTON: Oil prices eased on Tuesday (Oct 31) as markets worried less about potential supply disruptions from the Middle East conflict and on data showing rising output from Opec and the United States.
Brent crude futures for December delivery, settled 4 cents lower at US$87.41 (RM416.42) a barrel, ahead of their expiry later on Tuesday. The more heavily traded January contract fell US$1.33, or 1.4% to US$85.02.
US West Texas Intermediate crude for December delivery fell US$1.29, or 1.6%, to US$81.02 (RM385.97), while those for January delivery fell US$1.18 to US$80.50.
Trading was choppy with prices up as much as US$1 higher during the session, but prices remain below US$90 a barrel.
A Hamas spokesman said it will release a number of foreign captives in the coming days.
“We’ve taken some of the war premium out of the prices,” said Phil Flynn, analyst at Price Futures Group.
Opec crude output rose by 180,000 barrels per day (bpd) in October, according to a Reuters survey, driven principally by Nigeria and Angola.
US field production of crude oil also rose to a new monthly record in August at 13.05 million barrels per day, the Energy Information Administration said.
Weaker-than-expected manufacturing and non-manufacturing activity data in China stoked fears of slowing fuel demand from the world’s No. 2 oil consumer.
Eurozone inflation in October was at its lowest level in two years, falling to 2.9% from 4.3% in September, according to Eurostat’s flash estimate. That means the European Central Bank is unlikely to increase interest rates anytime soon.
Slow global economic growth will keep crude prices anchored below US$90 a barrel this year and next, unless the Israel-Hamas conflict draws in more countries in the Middle East and exacerbates supply tightness, a Reuters poll showed on Tuesday.
Investors remained wary of the potential for other countries entering the conflict. “While Middle East developments have yet to affect oil, as the ground invasion intensifies, the risk of involvement from Iran rises, fuelling tight supply concerns,” said Fiona Cincotta, senior financial market analyst at City Index.
Looking ahead to a US Federal Reserve meeting ending on Wednesday, analysts expect the central bank to hold rates steady, according to a poll by CME's Fedwatch tool. – Reuters
Source: The Sun Daily
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