Crude oil prices: Brent, WTI shed 0.25% after subdued impact of Hurricane Beryl

Crude oil prices edged lower in early trade on Tuesday, July 8, after jitters in the commodities market were eased due to a subdued impact of Hurricane Beryl.

Brent, the global crude benchmark; and the U.S. West Texas Intermediate (WTI), American crude benchmark, slipped by around quarter-of-a-percentage point each as trading commenced in the Asian markets.

Brent futures for September delivery were priced at $85.51 a barrel at 0300 hours GMT, down 0.24% as against the last closing price. WTI futures for August delivery were trading 0.25% lower at $82.08 per barrel at the same time.

Subdued Beryl impact

Beryl made landfall late on Monday on the coast of Texas, in an area where 40% of the United States' crude is produced. There were fears that a severe impact of the hurricane could affect production for several days, and cause supply chain disruptions.

However, Beryl downgraded into a tropical storm by the time it made landfall. The ports of Corpus Christi, Houston, Galveston, Freeport and Texas City, which were directed to remain closed from Sunday in anticipation of the hurricane, have been allowed to resume operations.

Oil rates to rise in the week ahead?

In the week ahead, oil prices may be positively impacted if data shows a further climbdown in American crude stockpile. There is a good chance that the US oil inventories may drop again as summer demand has picked up, suggested IG analyst Tony Sycamore.

The uptick in oil prices was also supported by growing optimism over the US Federal Reserve initiating its rate cut cycle in the near future.

Data released last week indicated a softening of the US economy, as the services sector declined in June vis-a-vis May, and the initial unemployment filings rising to a 2.5-year high. This, say analysts, would encourage the Fed to begin slashing the benchmark interest rates, which are at a historic high.

A decrease in the lending rates in the US will lead to an overall spurt in consumption. This is expected to lead to an uptick in crude prices, given the fact that the US remains the world's top oil consumer.

"A slowdown in growth momentum will support disinflationary impulses in coming months, paving the way for the Fed to cut rates," Reuters quoted ANZ Research analysts as saying last week.