Crude oil prices slip on Gaza ceasefire talks, China demand concerns; Brent below $78/barrel

Crude oil prices, which settled in the red on Monday, slipped further during the early trade on Tuesday as talks over the potential ceasefire in Gaza gained pace.

A de-escalation of tensions in Gaza, and thereby in the wider Middle East region, will ease the commodity market's concerns over the supply of crude from the region. This, in turn, is expected to reduce the pressure on global oil rates.

Global crude benchmark Brent remained below the $78 per barrel-mark. At around 0230 hours GMT, it was trading 33 cents or 0.42% lower at $77.32 a barrel.

The U.S. West Texas Intermediate (WTI), the American crude benchmark, slipped 37 cents or 0.5% to trade at $74 per barrel.

The fresh decline in crude oil prices comes after US Secretary of State Antony Blinken told reporters that Israel has signalled its readiness to accept a ceasefire proposal backed by the United States.

“In a very constructive meeting with Prime Minister Netanyahu today, he confirmed to me that Israel supports the bridging proposal," Bloomberg quoted Blinken as saying on Monday, after he arrived in Tel Aviv and held talks with the Israeli PM.

Notably, the war in Gaza has led to the death of over 40,000 Palestinians, which includes mostly civilians, according to the Gaza health ministry.

China demand concerns

Crude oil prices have been declining significantly since last week, after data released by Beijing on Thursday indicated that the Chinese economy lost momentum in July. During the month, new home prices in China dropped to its lowest in the past nine years, it showed.

This indicated that domestic demand continues to remain low in China, which is the world's largest crude oil importer.

The Organization of Petroleum Exporting Countries (OPEC) reduced its demand forecast for 2024 to 2.11 barrels per day (bpd), down by 140,000 bpd as against its previous forecast. The cartel cited the "softening expectations for China's oil demand growth in 2024" as one of the reasons behind the lowering of forecast.