Lauren Miller

April 25, 2024 - 02:15 am

Oil prices inched higher during early Asian trading on Tuesday, rebounding from losses observed in the previous session, as investors remained focused on evaluating the geopolitical tensions prevailing in the Middle East.

Price Movement:

• The global benchmark, Brent crude oil futures, saw a rise of 39 cents, equivalent to 0.5%, reaching $87.39 a barrel by 0033 GMT.
• Similarly, U.S. West Texas Intermediate crude futures climbed by 40 cents, or 0.5%, to $82.30 a barrel.

Previous Session's Performance:

• Both benchmarks experienced a decline of 29 cents in the prior session, indicating that recent escalations between Israel and Iran had minimal immediate impact on oil supplies originating from the region.

Ongoing Risks in the Oil Market:

• Analysts pointed out that despite the modest easing of tensions, numerous risks persist in the oil market.
• ANZ analysts highlighted the approval of new U.S. sanctions targeting Iran's oil sector, which extend to encompass foreign ports, vessels, and refineries involved in processing or transporting Iranian crude.
• The analysts emphasized the prevailing geopolitical uncertainties, suggesting that heightened volatility is likely until clearer insights are obtained.
• Barclays analysts echoed similar sentiments, indicating that although the immediate threat of geopolitical risks affecting oil market fundamentals has diminished, the overall trend since October remains worrisome.

Inventory Expectations:

• A preliminary Reuters poll of analysts indicated an anticipated increase in U.S. crude oil inventories for the previous week, alongside a projected decline in refined product stockpiles.