[ad_1]
© Reuters.
Investing.com– Oil prices fell from a near 10-month high on Monday, seeing a measure of profit taking after a stellar rally over the past month, although bets on tightening supplies still kept Brent above key levels.
Markets turned cautious before key due later this week, which is largely expected to factor into interest rates. A is also on tap later in September.
Oil prices saw a strong run-up last week after Saudi Arabia and Russia announced deeper-than-expected supply cuts for the remainder of the year, spurring bets that market tightness will help offset any potential demand headwinds from rising interest rates.
But prices now appeared to have paused amid some profit taking, while uncertainty over interest rates and fears of a potential drop-off in U.S. demand also kept markets uncertain.
fell 0.5% to $90.25 a barrel, while fell 0.8% to $86.85 a barrel by 20:47 ET (00:47 GMT).
IEA, OPEC reports on tap this week
Focus this week is on monthly reports from the (OPEC) and the (IEA) for their respective forecasts for oil markets.
Both groups expect tighter supplies to lift oil prices this year, and have also reiterated that crude demand is expected to remain relatively strong thanks to a recovery in China.
But a swathe of recent data showed that China’s economy was cooling despite the lifting of anti-COVID restrictions earlier this year. While the country’s oil imports have remained steady, doubts have risen over its appetite for fuel, especially amid deteriorating economic conditions.
Recent data showed that crept back into positive territory in August, while remained in deflation territory.
Dollar strong with inflation, Fed in focus
Strength in the also stemmed further gains in crude, as the greenback rose for eight straight weeks to a near six-month high.
Recent signs of resilience in the U.S. economy- particularly in inflation and the labor market- pushed up concerns that the Federal Reserve will have enough headroom to keep interest rates higher for longer.
Markets fear that this trend could spur more cooling in the U.S. economy, potentially denting crude demand. U.S. fuel demand is also expected to cool in the coming months, with the end of the travel-heavy summer season.
A stronger dollar also weighs on oil demand by making crude more expensive for international buyers.
[ad_2]
Source link
(This article is generated through the syndicated feed sources, Financetin doesn’t own any part of this article)
