Oil prices steadied on Wednesday as uncertainty looms over what may happen next in the Middle East conflict, while an outlook for ample supply next year added downward pressure, Reuters reported, UNN wrote.
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On Tuesday, oil fell by more than 4% to a nearly two-week low in response to a weaker demand outlook and after media reports that Israel will not strike Iranian nuclear and oil facilities, easing fears of supply disruptions.
As of 16:03 Kyiv time, Brent crude oil futures rose by 18 cents, or 0.24%, to $74.43 per barrel. West Texas Intermediate futures in the United States rose by 18 cents, or 0.26%, to $70.76.
"Ongoing geopolitical tensions combined with weak demand outlooks create an uncertain outlook for global oil prices in the short term. Market participants are likely to remain cautious, which could lead to further volatility," said Christopher Tahir, Senior Market Strategist at Exness.
Concerns about the escalation of the conflict between Israel and the Iranian-backed militant group Hezbollah reportedly remain. Supply restrictions by the Organization of the Petroleum Exporting Countries and its allies, including Russia, a group known as OPEC+, remain in place until December, when some members are expected to begin to lift the cuts, the newspaper writes.
"We see the market moving toward oversupply by 2025," said Norbert Rücker of Julius Baer.
On the demand side, this week OPEC and the International Energy Agency lowered their forecasts for global oil demand growth for 2024, with China accounting for the bulk of the reduction. Economic stimulus in China has reportedly failed to significantly support oil prices.
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Markets are also awaiting the latest data on US oil inventories.