Singapore May 6 2024: Oil futures edged up on Monday after Saudi Arabia hiked June crude prices for most regions and as the prospect of a Gaza ceasefire deal appeared slim, renewing fears the Israel-Hamas conflict could still widen in the key oil producing region.
Brent crude futures climbed 28 cents, or 0.3%, to $83.24 a barrel at 0119 GMT, while U.S. West Texas Intermediate crude futures were at $78.40 a barrel, up 29 cents, or 0.4%.
Saudi Arabia raised the official selling prices (OSPs) for its crude sold to Asia, Northwest Europe and the Mediterranean in June, signalling expectations of strong demand this summer.
“After falling a little more than 7.3% last week due to easing geopolitical tensions, ICE Brent has started the new trading week on a stronger footing, opening higher,” ING’s head of commodities research Warren Patterson said in a note.
This comes after Saudi Arabia raised June OSPs for most regions amid a tightening of supplies this quarter, he added.
Last week, both futures contracts posted their steepest weekly loss in three months with Brent falling more than 7% and WTI down 6.8%, as investors weighed weak U.S. jobs data and the possible timing of a Federal Reserve interest rate cut.
The geopolitical risk premium in oil prices has also eased as talks for a Gaza ceasefire are underway.
