Oil steady on Thursday

Oil prices steadied near the lowest levels since January as concerns about a potential US economic slowdown outweighed the positive impact of declining inventories. Brent crude traded around $76 per barrel, following a four-day decline, while West Texas Intermediate (WTI) fell below $72.

The slump has been driven by worries over US job growth and weaker US and China consumption, erasing year-to-date gains despite OPEC+ supply cuts.

Traders are focusing on the upcoming Jackson Hole symposium, where Federal Reserve Chair Jerome Powell will provide insights on the economy. The recent selloff persisted even as US crude inventories hit their lowest point since January, and distillate and gasoline stocks also decreased.

In the Middle East, the US continued efforts to negotiate a cease-fire in Gaza. President Joe Biden and Vice President Kamala Harris discussed the situation with Israeli Prime Minister Benjamin Netanyahu.

Despite weak Chinese oil imports and subdued US fuel demand, Citigroup analysts noted that weather-related disruptions during hurricane season and geopolitical risks could present buying opportunities, potentially pushing Brent back to $80 per barrel. Timespreads have also shown less tightness, with the gap between December 2024 and December 2025 contracts narrowing.

Attribution: Bloomberg

Subediting: M. S. Salama