Oil steady in early Monday trade

Oil prices remained steady after their first weekly gain since early July, Brent crude traded below $80 per barrel, rising nearly 4 per cent last week, while West Texas Intermediate (WTI) hovered around $77.

Vivek Dhar, an analyst with the Commonwealth Bank of Australia, warned that the primary market concern would be potential attacks on Iran’s oil supply, which constitutes about 4 per cent of global production. Dhar predicts Brent oil futures will trade between $75 and $85 per barrel in the short term, though tensions in the Middle East pose upside risks.

Crude oil has mirrored a recovery in equity markets after hitting a seven-month low last week, though concerns over China’s economic outlook, the largest importer, continue to dampen sentiment.

Traders are closely watching upcoming reports from OPEC+, the International Energy Agency (IEA), and US inflation data for insights into supply and demand.

Meanwhile, money managers have reduced their net bullish positions on Brent to the lowest level since 2011, and have turned net-bearish on diesel. The physical market also shows signs of stress, with US refineries slowing down as profit margins shrink.

Attribution: Bloomberg