Oil Prices Recover

Oil prices moved higher after a recent decline, with West Texas Intermediate (WTI) climbing above $73 a barrel. This increase follows a drop of about 5% over the past three trading sessions. Traders are watching closely the weekly inventory data from the US, with the American Petroleum Institute reporting an increase of 347,000 barrels in crude inventories last week. Official inventory figures are expected later today.

Geopolitical and Economic Factors

US Secretary of State Antony Blinken left the Middle East on Tuesday evening without a ceasefire agreement between Israel and Hamas. However, Blinken mentioned that Israel had agreed to a “bridging” deal to facilitate further negotiations. Options markets are showing signs of easing concerns about the ongoing conflict in the region.

Crude oil prices have largely given up their gains from earlier this year, as weaker economic data from China overshadowed OPEC+ production cuts. Investors are also focusing on US economic indicators, particularly regarding inflation. Lower inflation could lead the Federal Reserve to reduce interest rates, potentially increasing overall energy demand. Federal Reserve Chair Jerome Powell is scheduled to speak at the central bank’s symposium in Jackson Hole, Wyoming, later this week.