Oil prices dip as traders monitor geopolitical tensions

A barrel of Brent crude oil traded at USD74.79 on Friday, down from USD75.83 the previous day, while West Texas Intermediate fell to USD70.66 a barrel from USD71.56.

Oil prices dip as traders monitor geopolitical tensions

This week, oil prices have stabilized and are expected to close with slight gains amid cautious sentiment as traders assess geopolitical developments in the Middle East, according to Tickmill analyst Joseph Dahrieh. "Diplomatic efforts may alleviate fears of escalation, which could pressure oil prices," Dahrieh noted. On Friday, U.S. Secretary of State Antony Blinken emphasized the need for "real urgency" in seeking a diplomatic resolution in Lebanon and urged Israel to protect civilians, although he did not call for an immediate ceasefire, as reported by AFP. "The market remains near its lowest levels this year and could experience further declines if geopolitical tensions ease," Dahrieh explained. "However, a resurgence in tensions could lead to a rebound in oil prices."

Concerns on demand

He also highlighted ongoing concerns about demand levels, which continue to influence market expectations. "Traders will likely keep a close eye on developments in China to assess how its slowing economic growth impacts crude demand, particularly the outcomes of China's NPC Standing Committee meeting. Any indications of pro-growth policies could bolster oil demand and support crude prices," Dahrieh added.