SINGAPORE, Jan 30 (Reuters) – Crude oil prices fell on Monday, losing gains. Global producers are likely to hold production at this week’s meeting, and investors are cautious ahead of the Federal Reserve’s meeting.
Brent crude futures fell 74 cents (0.8%) to $85.92 a barrel by 0710 GMT, while US Central West Texas crude fell 61 cents (0.8%) to $79.07 a barrel. .
Ahead of the Federal Reserve’s policy meeting scheduled for January 31-February. Markets are broadly expecting the US central bank to raise interest rates by at least 25 basis points, suggesting that the Fed’s long-term increase in borrowing costs could dampen fuel demand growth in the US, the world’s largest oil consumer. There is growing concern that
“Possible rate hikes at upcoming Fed meetings are likely weighing on oil prices,” Serena Huang, head of APAC analysis at Vortexa, said in an email.
Ministers from the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia (collectively known as OPEC+), are unlikely to meet virtually on Feb. 1 to fine-tune current oil production policies.
Still, Brent and WTI posted their first weekly losses in three weeks last week, on signs that crude exports from Russia’s Baltic ports had picked up in early February.
Analysts at National Australia Bank said in a research note that “no OPEC+ production changes are expected to be announced at this week’s meeting, and the US Federal Reserve’s outlook comments are expected in the near future.” We expect it to be a major driver of
Oil prices rose on Monday as tensions rose in the Middle East following a drone strike in oil-producing Iran.
It is not yet clear what is happening in Iran, but any escalation in Iran could disrupt oil flows, said Stefano Grasso, senior portfolio manager at 8VantEdge in Singapore.
China, the world’s largest oil importer, pledged over the weekend to spur a consumption recovery to support fuel demand after lifting strict COVID-19 curbs in December.
The country will resume business this week after the Lunar New Year holiday. The number of passengers traveling before the holidays was above the levels of the past two years, but he was still below 2019, analysts at Citi said in a note, citing data from the Department of Transportation.
“Overall international passenger traffic recovery continues to be modest, reaching levels in the high single digits to low teens to 2019 levels and should pick up further once outbound group travel resumes on 6 February. is expected to do so,” said the Citi memo.
Reporting by Florence Tan and Emily Chow. Edited by Muralikumar Anantharaman and Christian Schmollinger
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