Crude oil rates today: Brent edges lower day after declining by 1% on Gaza ceasefire push
Upstox
3 min read • Updated: April 30, 2024, 12:11 PM
Summary
The fresh decline in crude prices, a dip of $1.1 per barrel on Monday, followed by another decline of around $0.3 per barrel today, was likely triggered by the renewed diplomatic push for a ceasefire in Gaza.
Global crude benchmark Brent was edging lower during the early trading hours on Tuesday, April 30, a day after the rates declined by around 1% on the growing chorus for a ceasefire in Gaza.
The Brent crude futures for June delivery decelerated to as low as $88.07 a barrel at the Intercontinental Exchange Europe at around 6:15 hours GMT. The U.S. West Texas Intermediate crude futures also declined by 0.34% to $82.35 an ounce.
Brent has significantly decelerated as compared to earlier this month, when escalating Iran-Israel tensions had peaked the prices above $92 a barrel. The concerns of the commodities market were eased after the tit-for-tat strikes by both the countries on each other’s soil caused only a modest damage with no fatalities.
The price has remained below $90 a barrel since the past week, as the market was calmed with Iran and Israel indicating at not further climbing the escalation ladder.
The fresh decline in crude prices, a dip of $1.1 per barrel on Monday, followed by another decline of around $0.3 per barrel today, was likely triggered by the renewed diplomatic push for a ceasefire in Gaza.
According to the UK, Israel has offered a deal to Palestinian militant group Hamas that includes a 40-day ceasefire if all the captives are released. Hamas, however, is expected to insist on a permanent ceasefire and the pullback of all Israeli troops from Gaza, Al Jazeera reported.
Will Brent cross $100 per barrel?
The probability of oil crossing $100 per barrel in the immediate future remains low, said analysts, pointing out that Iran and Israel appear to have backed down from a military faceoff. The possibility of a ceasefire pact between Israel and Hamas in Gaza also indicates that the prices of oil would not flare up.
However, apart from the Middle East tensions, the growth and inflation dynamics in China, Europe and the United States, along with the strategy enacted by the Oil Producing and Exporting Countries and their allies (OPEC+) will also weigh-in on the crude rates in the period to come.
The rates had climbed earlier this month after the OPEC+ announced an extension in production cuts of up to 2.2 million barrels per day till June-end this year.
The uncertainty related to the interest rate cuts in the United States, where inflation numbers have been rising, also adds to the volatility of the crude market.
Notably, the projected oil demand for 2024 was slashed by the International Energy Agency (IEA) in the forecast released last week. The agency predicts an average consumption of 1.2 million barrels per day, down by 130,000 barrels as compared to its previous forecast.