Oil prices fell slightly on Tuesday as investors weighed the prospect of more OPEC+ supply, jitters over US budget talks, and a new US proposal aimed at resolving the Gaza conflict.
Brent crude was trading at $66.66 per barrel at 9.46 a.m. local time (0646 GMT), down 0.06% from the previous close of $66.70.
US benchmark West Texas Intermediate (WTI) decreased by 0.06% to $62. 92 from $62.96 in the prior session.
The focus is on the OPEC+ meeting on October 5, where Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria and Oman are expected to decide November output.
The group agreed last month to raise production by 137,000 barrels a day in October. Analysts say expectations of further increases are reinforcing forecasts of excess supply in global markets.
On the demand side, worries over a possible US government shutdown are weighing on prices.
US Vice President JD Vance said Monday that chances of avoiding a shutdown were slim as a pivotal October 1 deadline approaches.
"I think we're headed to a shutdown because the Democrats won't do the right thing. I hope they change their mind, but we're going to see," Vance told reporters at the White House shortly after meeting with the top Republican and Democratic leaders in Congress.
Meanwhile, a 20-point Gaza plan announced Monday by US President Donald Trump raised questions over its implementation. However, the proposal has temporarily eased regional tensions and lowered the risk premium in oil markets.
Trump unveiled the plan at a White House news conference with Israeli Prime Minister Benjamin Netanyahu. The proposal envisions transforming Gaza into "a deradicalized terror-free zone that does not pose a threat to its neighbors" while ensuring the enclave "will be redeveloped for the benefit of the people of Gaza, who have suffered more than enough."
Under the plan, "if both sides agree to this proposal, the war will immediately end," with Israeli forces withdrawing to agreed positions. During this process, all military operations will be suspended, and the battle lines will be frozen until the necessary conditions for a phased withdrawal are met.
Within 72 hours of Israel's acceptance, all hostages, both living and deceased, must be returned, according to the plan's outline, also posted on social media.
Following the hostage releases, Israel would free 250 life-sentence prisoners and 1,700 Gazans detained after Oct. 7, 2023. For every Israeli hostage whose body is returned, Israel will return the bodies of 15 Gazans who were killed, according to the plan.
Hamas members who "commit to peaceful co-existence and to decommission their weapons will be given amnesty," and Hamas members wishing to leave Gaza would also be provided with safe passage to countries that accept them.
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr