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Oil prices increased in Asian trading on Monday, continuing their rebound from the previous session. The ongoing conflict between Israel and Hamas showed no signs of a ceasefire, while comments from Federal Reserve Chair Jerome Powell fueled expectations of a September interest rate cut, further supporting oil prices.
- Brent crude futures for October delivery rose 0.8% to $79.59 a barrel.
- West Texas Intermediate (WTI) crude futures climbed 0.6% to $75.45 a barrel by 21:01 ET (01:01 GMT).
Middle East Conflict Impact
Attempts to reach a ceasefire between Israel and Hamas in Cairo over the weekend were unsuccessful, leading to continued hostilities. This ongoing conflict, now in its tenth month, has added a risk premium to oil prices as traders remain concerned about potential disruptions to oil production in the Middle East, a region rich in crude resources.
U.S. Interest Rate Outlook
Optimism over a potential rate cut in September also buoyed oil markets. Jerome Powell’s recent comments solidified expectations that the U.S. Federal Reserve may lower interest rates, contributing to a weaker dollar and further supporting oil prices.
The combination of geopolitical instability and favorable economic conditions in the U.S. has led to a cautious yet positive outlook for oil in the short term.
