Oil prices saw a marginal increase on Friday (Saturday AEDT) following the release of data indicating a slowdown in US inflation. This positive news helped to counterbalance ongoing concerns about supply, particularly as OPEC+ considers resuming production increases. Brent Crude futures experienced a rise of 0.3 per cent, settling at $US67.75 a barrel. Similarly, US West Texas Intermediate crude saw a slight uptick of 0.1 per cent, reaching $US62.89.
Despite Friday’s gains, both benchmarks concluded the week with declines. Brent Crude finished approximately 0.5 per cent lower, while WTI recorded a loss of 1 per cent over the week. The US Bureau of Labor Statistics reported that consumer prices in the United States increased less than anticipated in January, driven by cheaper gasoline prices and a moderation in rental inflation.
Earlier in the week, oil prices were bolstered by concerns surrounding a potential US military action against Iran, a Middle Eastern oil producer, related to its nuclear program. However, comments made by US President Donald Trump on Thursday (Friday AEDT), suggesting the possibility of a deal with Iran in the near future, led to a subsequent decrease in prices. Meanwhile, Russia announced on Friday (Saturday AEDT) that the next round of peace talks concerning Ukraine is scheduled to take place next week.
Dennis Kissler, Senior Vice President of Trading at BOK Financial, noted that negotiations involving Iran and Russia are expected to be key drivers in the near-term market. Kissler added that global crude supplies remain abundant in the short term and that crude futures likely incorporate a geopolitical premium of $US5 to $US7 per barrel.
