West Texas Intermediate (WTI), the benchmark for US crude oil, is trading near $78.85 on Thursday, experiencing a slight dip. This decline comes as optimism grows around the potential for a ceasefire agreement between Hamas and Israel, which could ease geopolitical tensions in the Middle East and reduce the risk of disruptions to oil supplies in the region.
An official source confirmed that Israel and Hamas have reached a deal to halt hostilities in Gaza and exchange Israeli hostages for Palestinian prisoners. If this conflict ends, it would alleviate regional tensions and lower the likelihood of interruptions to crude oil deliveries, a factor that has traditionally supported higher oil prices.
Despite this potential relief, the impact on WTI prices is tempered by a continued reduction in US crude oil inventories. According to the US Energy Information Administration’s latest report, crude oil stockpiles for the week ending January 10 decreased by 1.962 million barrels, following a previous week’s drop of 959,000 barrels. This figure surpassed market expectations, which had forecasted a decline of 1.6 million barrels, signaling tighter US supply.
Market participants are now awaiting two key reports later Thursday: US Retail Sales data for December and the weekly Initial Jobless Claims figures. Should these reports reveal weaker-than-expected economic activity, it could prompt a decline in the US dollar, potentially boosting the price of the USD-denominated crude oil.
Related topics:
Oil Prices Stabilize Amid China’s Economic Weakness and U.S. Stockpile Drawdown
Global Markets on Edge as Trump’s Tariff Promises Loom
China Unveils New Subsidy Program to Boost Domestic Consumption and Industrial Upgrades
