Oil Prices Steady as Markets Refocus on Demand Concerns

FILE PHOTO: A view of the newly-commissioned Dangote petroleum refinery is pictured in Ibeju-Lekki, Lagos, Nigeria May 22, 2023. REUTERS/Temilade Adelaja/File Photo
FILE PHOTO: A view of the newly-commissioned Dangote petroleum refinery is pictured in Ibeju-Lekki, Lagos, Nigeria May 22, 2023. REUTERS/Temilade Adelaja/File Photo
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Oil Prices Steady as Markets Refocus on Demand Concerns

FILE PHOTO: A view of the newly-commissioned Dangote petroleum refinery is pictured in Ibeju-Lekki, Lagos, Nigeria May 22, 2023. REUTERS/Temilade Adelaja/File Photo
FILE PHOTO: A view of the newly-commissioned Dangote petroleum refinery is pictured in Ibeju-Lekki, Lagos, Nigeria May 22, 2023. REUTERS/Temilade Adelaja/File Photo

Oil prices steadied on Tuesday after rising for five consecutive sessions, as markets refocused on concerns about demand after OPEC on Monday cut its forecast for demand growth in 2024 due to softer expectations in China.
Benchmark Brent crude futures were down 30 cents, or 0.36%, at $82.00 a barrel as of 0820 GMT. US West Texas Intermediate crude was down 29 cents, or 0.36%, at $79.77, Reuters reported.
Brent on Monday gained more than 3% while US crude futures rose more than 4% on expectations of a widening Middle Eastern conflict that could tighten global crude oil supplies.
The 2024 demand forecast cut from the Organization of the Petroleum Exporting Countries' (OPEC) highlighted the dilemma faced by the wider OPEC+ group as it aims to raise output from October.
"Any reflection of higher economic risks could weigh on oil prices, at a time when OPEC+ has cut their 2024 demand forecast and are set to roll back on their production cuts starting October, which may point to a less tight oil market ahead," said Yeap Jun Rong, market strategist at IG.
But he added investors remained watchful of the latest geopolitical tensions.
The Middle East conflict has escalated, with the US preparing for what could be significant attacks by Iran or its proxies in the region as soon as this week, White House national security spokesperson John Kirby said on Monday.
Any attack could tighten access to global crude supplies and boost prices. An assault could also lead the United States to place embargoes on Iranian crude exports, potentially affecting 1.5 million barrels per day of supply, analysts said.
"If an eventual Iran retaliation falls within the scope of a so-called proportionate response, and the macro disappoints, then Brent holding on to its $80 handle may prove challenging," said Harry Tchilinguirian, head of research at Onyx Capital Group.
Markets are also preparing for Wednesday's US consumer price index report that will give a crucial read on inflation.



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.