Oil prices remained largely unchanged on Tuesday as investors awaited key data releases, including U.S. inflation indicators and the monthly report from the Organization of the Petroleum Exporting Countries (OPEC).
According to Reuters, Brent crude futures dipped by 18 cents to $83.18 a barrel at 0808 GMT, while U.S. West Texas Intermediate (WTI) crude futures also experienced a decrease of 18 cents, settling at $78.94 a barrel.
Monday witnessed significant gains for both Brent and WTI, marking their largest daily increases in over two weeks and a month, respectively. These gains were attributed to signs of improving demand in the U.S. and China, the world’s top two oil consumers.
“Oil prices were slightly higher overnight but remain in a broad holding pattern over the past week, with the lead-up to the upcoming U.S. inflation data keeping some reservations in place,” said Yeap Jun Rong, market strategist at IG.
Investors are particularly interested in Wednesday’s release of the U.S. Consumer Price Index data, as it could provide insights into the Federal Reserve’s considerations regarding interest rate cuts, which could impact economic growth and, consequently, oil demand.
Yeap also highlighted the significance of the upcoming OPEC monthly oil report in providing updates on global oil demand, especially regarding the optimistic guidance for the summer travel season.
In addition to data releases, the market is closely monitoring wildfires in remote western Canada, which pose potential disruptions to the country’s oil supply. While firefighters race to contain the blazes, concerns arise over the impact on Alberta’s oil sands industry, with memories of past shutdowns due to wildfires resurfacing.
“Spreading wildfires in Alberta oil sands impose downside risks to our constructive Canada production outlook as massive fires in the same region eight years ago triggered a temporary shutdown of over 1 million bpd oil production,” said Goldman Sachs analysts in a note.
