Zeynep Beyza Kılıc
23 October 2024•Update: 23 October 2024
ANKARA
Oil prices held steady on Wednesday as weakening demand prospects in the US, the world’s largest crude consumer, offset gains from Middle East tensions. This followed a 2% increase in the previous session after the Israeli army claimed responsibility for killing the head of Hezbollah’s Executive Council in an airstrike earlier this month.
Brent crude, the international benchmark, rose 0.03% to $75.31 per barrel at 10:48 a.m. local time (0748 GMT), slightly up from the previous session's close of $75.28. The US benchmark, West Texas Intermediate (WTI), also edged up 0.02% to $71.29 per barrel, compared to $71.27 in the prior session.
The American Petroleum Institute (API) reported late Tuesday that US commercial crude oil inventories increased by 1.64 million barrels, surpassing market expectations of a 700,000 barrel rise. This larger-than-expected build reflected concerns over falling domestic demand, putting downward pressure on prices.
The Energy Information Administration (EIA) is set to release official inventory data later in the day, and a confirmed increase in crude stockpiles could further weigh on prices.
Meanwhile, Israel's heightened military actions in the Middle East are continuing to impact the oil market. On Tuesday, the Israeli military confirmed that "Hisham Safieddine, head of the Hezbollah Executive Council, and Ali Hussein Hazima, commander of Hezbollah's Intelligence Headquarters, were eliminated by the IDF (army), along with additional Hezbollah commanders," in an airstrike three weeks ago in southern Beirut.
"They were eliminated in a strike carried out approximately three weeks ago in the area of Dahieh," the military said.
Following the Israeli army’s acknowledgment of the killings, oil prices surged as traders anticipated more instability. "Oil prices surged because traders aren't buying the chances of a ceasefire and hence expect more escalation," Osama Rizvi, energy and economy analyst at the US-based market intelligence firm Primary Vision, told Anadolu.
Some positive economic activity in the US and China, the world’s top oil consumers, has helped limit further price declines. "Looking at the data from the US economy, there seems to be some bright spots such as a resurge in retail sales and a fall in unemployment claims by 19,000," Rizvi said.
Referring to China’s stimulus measures, Rizvi noted that house viewings rose during the National Holiday season, "but remains well below expectations."
However, global economic concerns persist. Rizvi said, "there is a downward trend in global markets as data points from the Eurozone and global manufacturing paint a worrisome picture of the global economy. Same has been wanted by IMF and other famous economists."
