Oil prices have stabilized as the market awaits U.S. economic data that will serve as a catalyst to break out of the narrowest trading range in three years. Brent crude oil is trading near $85 a barrel and has seen minimal fluctuations this week, with the narrowest price range since the start of 2021. Traders are watching various US economic data releases, particularly employment figures, over the next few days to gauge their impact on oil and broader financial markets.
Despite a bigger-than-expected increase in US crude inventories, oil prices were little changed on Thursday as West Texas Intermediate settled below $81 a barrel on Thursday. Oil is poised for a monthly gain, and there are predictions of future price increases in the coming quarter due to seasonal strength. The oil market was affected by movements on the broader stock markets, and the upcoming elections in Iran and France could introduce additional price volatility.
Charu Chanana, market strategist at Sako Capital Markets Pte in Singapore, noted that oil demand signals were mixed but generally positive with summer travel and cooling demand supporting prices. U.S. Gulf Coast crude inventories rose by 2 million barrels, reaching levels not seen since 2020 on a seasonal basis, while total inventories were the highest since April. However, there are indications of lower fuel consumption, as measures of demand for gasoline and jet fuel show signs of falling.
As traders wait for U.S economic data to provide direction, they remain uncertain about how this will impact prices in the near term