Oil prices rose on Tuesday after a brief sell-off on reports of a potential ceasefire between Israel and Lebanon’s Hezbollah, steadying after falling more than $2 a barrel in the previous session.
Brent crude futures were up 53 cents, or 0.7%, at $73.54 a barrel, while U.S. West Texas Intermediate crude futures rose to $69.46 a barrel, up 52 cents, or 0.75%. The news of a potential ceasefire helped calm market nerves and reduced concerns about further disruptions to oil supplies.
The Middle East conflict has not significantly disrupted oil supplies in the past, said senior market analyst Priyanka Sachdeva at Phillip Nova. A ceasefire would also reduce the likelihood of additional sanctions on Iranian crude, which is produced by Iran and supports Hezbollah.
OPEC+ may consider keeping its current output cuts in place from January 1, according to reports. The producer group is already postponing hikes amid global demand worries.
The International Energy Agency expects plentiful oil supplies this year and next unless a major geopolitical escalation occurs. US President-elect Donald Trump said he would impose a 25% tariff on all products coming into the US from Mexico and Canada, but analysts say it’s unlikely to include crude oil exports.
In contrast, China is expected to face higher tariffs under a proposed additional 10% tariff on imports from China, which could impact global markets.
Source: https://www.reuters.com/business/energy/oil-falls-potential-deal-end-israel-hezbollah-conflict-2024-11-26