Oil Falls as US Recession Fears Offset Mideast Tensions

A man pumps gas into a vehicle at a petrol station on October 2, 2023 in Alhambra, California. (Photo by Frederic J. BROWN / AFP)
A man pumps gas into a vehicle at a petrol station on October 2, 2023 in Alhambra, California. (Photo by Frederic J. BROWN / AFP)
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Oil Falls as US Recession Fears Offset Mideast Tensions

A man pumps gas into a vehicle at a petrol station on October 2, 2023 in Alhambra, California. (Photo by Frederic J. BROWN / AFP)
A man pumps gas into a vehicle at a petrol station on October 2, 2023 in Alhambra, California. (Photo by Frederic J. BROWN / AFP)

Oil prices fell on Monday as fears of a recession in the United States, the world's top oil consumer, offset concerns that escalating tensions in the Middle East may affect supplies from the largest producing region.
Brent crude futures inched down 4 cents, or 0.1%, to $76.77 a barrel by 0035 GMT, while US West Texas Intermediate crude futures were at $73.39 a barrel, down 13 cents, or 0.2%.
Prices were supported by persistent fighting in Gaza with an Israeli airstrike hitting two schools and killing at least 30 people on Sunday, Palestinian officials said, the day after a round of talks in Cairo ended without result.
Israel and the United States are bracing for a serious escalation in the region after Iran and its allies Hamas and Hezbollah pledged to retaliate against Israel for the killings of Hamas' leader Ismail Haniyeh and Fuad Shukr, a top Hezbollah military commander last week.
"If this conflict intensifies, crude exports could be impacted," ANZ analysts said in a note.
Despite worries about escalating tensions in the Middle East, Brent tumbled more than 3% on Friday to settle at its lowest since January. WTI, meanwhile, fell more than 3% to settle at its lowest since June.
Both contracts marked their fourth straight week of losses, their biggest losing streaks since November.
In the U.S., the number of operating oil rigs were steady at 482 last week, Baker Hughes said in a weekly report.
Weak economic data across the globe weighed on oil prices, on concerns that a sluggish global economic recovery would dampen fuel consumption.
Data released last week showed that the US economy added fewer jobs than expected last month while factories across the US, China and Europe grappled with tepid demand.
Slumping diesel consumption in China, the world's biggest contributor to oil demand growth, is weighing on global oil prices.



Gold Gains on Fed Rate Cut Hopes

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
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Gold Gains on Fed Rate Cut Hopes

Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo
Gold bars from the vault of a bank are seen in this illustration picture taken in Zurich November 20, 2014. REUTERS/Arnd Wiegmann/File Photo

Gold prices rose on Thursday on expectations of a US Federal Reserve rate cut next week, while palladium hit its highest in more than two months due to supply concerns from top producer Russia.
Spot gold was up 0.3% at $2,517.88 per ounce by 0942 GMT, supported by the 21-day moving average at $2,505, Reuters reported.
US consumer prices rose marginally in August, but underlying inflation signaled some stickiness, which could result in the Fed delivering a smaller 25-basis-point cut at its meeting next week.
"Judging by gold's reaction to the latest US inflation data, it seems as if today's expectations of moderately lower US interest rates are sufficient to support prices around current levels of $2,500 per ounce at least in the short term," said Carsten Menke, an analyst at Julius Baer.
Traders are waiting for the US Producer Price Index (PPI) for August, the initial jobless claims print due later today and the consumer sentiment data on Friday for more clues on the Fed's path.
Palladium gained 0.6% to $1,014 per ounce. It earlier hit $1,030.68, the highest since July 8, on supply concerns after Russian President Vladimir Putin on Wednesday said that Moscow should consider limiting exports of uranium, titanium and nickel.
"Palladium is the market that is up for a short-covering rally. Putin did not mention palladium. But since the metal is a by-product of Russian nickel production, such export curbs could drive down production of both metals and deepen the current deficit in the palladium market," said WisdomTree commodity strategist Nitesh Shah.
Russia's Nornickel is the world's largest producer of palladium and a major producer of platinum, accounting for 41% and 12% of global mining output, respectively.
Spot silver added 0.4% to $28.81 and platinum gained 0.3% to $953.79.