© Reuters.
Investing.com – As of the early Asian trading on Monday, international oil prices fell, further retreating from recent highs, and the profit-taking sentiment was obvious. A weaker dollar and optimism over slowing U.S. inflation were the main factors previously driving oil prices higher.
However, the benefit of the rally stalled after data on Friday showed U.S. consumer sentiment and spending remained strong – keeping the Federal Reserve on a hawkish stance as the data suggested sticky inflation in the U.S. may be in the cards.
As of press time, it fell 0.85% to $79.19; down 0.88% to $74.66.
The two crude oil futures contracts have rallied sharply in the past three weeks, also due to tighter supplies in the crude market following the closure of oil fields and loading in Nigeria and Libya. However, that trend was offset by the resumption of production at most of Libya’s major oil fields over the weekend.
It is also worth noting that the crude oil market remains fully preoccupied with issues of tightening global supply and rising interest rates. This market is expected to see significantly less supply in the second half of 2023 as the impact of production cuts by Saudi Arabia and Russia begins to show.
However, analysts also expect this trend to be offset to some extent by a slowdown in global economic activity, especially against the backdrop of slowing U.S. economic growth, and interest rates are likely to remain high for a longer period of time – Fed The recent interest rate hike cycle has not been fully perceived and digested by the economy.
Regardless, the market appears to be losing momentum right now, despite the Federal Reserve’s pause on rate hikes, which has fueled a sharp rally in oil prices over the past two weeks.
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(Translation: Li Shanwen)
2023-07-17 02:28:00
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