Crude Oil Rebounds Amid Tensions

On 12th April 2024, Oil prices climbed due to Middle East tensions, yet they are poised for weekly losses amid dwindling U.S. rate cut expectations.

Key Points

Oil Prices Rise: Amid heightened tensions in the Middle East, oil prices climb, with Brent crude futures up by 0.57% to $90.25 and U.S. West Texas Intermediate crude futures rising by 0.72% to $85.63.
Weekly Losses Expected: Despite the rebound, oil is set for weekly losses, driven by expectations of fewer U.S. interest rate cuts amidst persistent inflation concerns.
Geopolitical Tensions: Suspected Israeli airstrikes on Iran's embassy in Damascus escalate tensions in the region, with Iran vowing revenge, raising concerns about supply disruptions.
Central Bank Policies: Divergent policies emerge as the European Central Bank hints at future rate cuts while the Federal Reserve remains cautious about reducing interest rates due to persistent inflation in the U.S.
Market Outlook: Oil prices are influenced by geopolitical risks, economic conditions, and supply dynamics, with ING analysts forecasting Brent to average $87 a barrel in the second quarter of the year.