Oil prices stabilized at the start of the week’s trading session, and are likely to continueto see the impact of political uncertainty in both the United States and the Middle East. Geopolitical tensions in the Middle
East, including clashes between Israel and Hamas as well as faltering peace talks, may also play a role; A role in pushing oil prices higher as a result of concerns related to regional stability.
The market also received a positive morale boost with the release of the US inflation report for June, which came in below expectations, which raised hopes for easing monetary policy by the Federal Reserve. This situation is expected to continue to support oil prices and reduce downside risks, given the possibility of lowering interest rates next September and easing pressures on the US economy. However, challenges remain, as China’s crude oil imports declined in June, reflecting the ongoing difficulties the market is witnessing. The slim profit margins also caused independent refiners to reduce their production, which contributed to the decline in demand for fuel and exacerbated these challenges.
Meanwhile, Fed Chairman Jerome Powell’s speech, scheduled to be delivered later today, is expected to weigh on the dollar and may cause volatility in crude oil prices. In addition, markets are awaiting the release of US retail sales and crude oil inventory change data on Tuesday. Market expectations indicate that retail sales numbers for June may stabilize. Continued weak sales in the United States are likely to impact oil prices in the short term.
Oil markets await Powell’s speech amid US political uncertainty and escalating tensions in the Middle East
