Aug 12 2024: Oil prices continued to climb on Monday, marking their fifth consecutive session of gains. This follows a rise of more than 3% last week, supported by easing U.S. recession fears and ongoing geopolitical tensions in the Middle East.
Brent crude futures increased by 73 cents, or 0.9%, to $80.39 a barrel as of 0812 GMT. U.S. West Texas Intermediate crude futures rose by 88 cents, or 1.2%, to $77.72.
“Recent support for oil prices stems from better-than-expected U.S. economic data, which has alleviated concerns about a U.S. recession,” noted Tony Sycamore, an analyst at IG Markets.
Tensions remain high over potential retaliation by Iran for the recent assassination of key Hamas and Hezbollah leaders by Israel. “The market is closely watching for Iran’s response,” said Warren Patterson, ING’s head of commodities research.
The situation in Gaza has also intensified, with a recent Israeli airstrike on a school compound resulting in at least 90 deaths, according to the Gaza Civil Emergency Service. However, Israel has disputed this figure, and Hamas has questioned its involvement in new ceasefire negotiations.
Last week, Brent crude gained 3.7%, while WTI increased by 4.5%, driven by favorable economic data and expectations of a potential U.S. interest rate cut. Three U.S. central bankers indicated that inflation appears to be cooling, which might prompt the Federal Reserve to reduce interest rates as early as next month. Additionally, China’s consumer prices rose more than anticipated in July, and U.S. weekly jobless claims fell more than expected.
On Monday, Russia began evacuating civilians from parts of a second region near Ukraine, following increased military activity by Kyiv and its largest incursion into Russian territory since the start of the 2022 war.
