WTI is heading for weekly gains on Friday amid an expected Fed rate cut and escalating tensions in Venezuela
WTI oil prices are poised for weekly gains amid an expected Fed rate cut, escalating US-Venezuela tensions, and the stalled peace talks in Moscow. However, both oil indices fell from the previous day.
Brent crude fell 14 cents, or 0.2%, to $63.12 per barrel by 04:00 GMT. The contract was largely flat for the week.
WTI fell 18 cents, or 0.3%, to $59.49 per barrel. However, it rose for the second consecutive week, posting a nearly 1.6% weekly gain.
The market is evaluating some positive demand news. This was supported by falling Kazakh oil shipments following a Ukrainian drone attack on the Caspian Pipeline Consortium's Black Sea loading facility.
Both contracts gained about 1% in the previous trading session.
82% of economists expected a 25 basis point rate cut at the upcoming Fed policy meeting. A rate cut would stimulate economic growth and oil demand.
Looking ahead, supply factors remain in focus. A peace agreement with Russia would bring more product to market and likely lower prices.
On the other hand, any geopolitical escalation would push prices higher.
OPEC+ agreed to hold production steady until early next year, providing some support for prices.
Markets also continued to brace for a possible US military intervention in Venezuela, as Trump announced late last week. Such a move would jeopardize Venezuela's 1.1 million barrels per day of crude oil production, which it supplies mostly to China.
Prices also rose this week as the US failed to make significant progress in Moscow on the war in Ukraine.
Above mentioned factors supported prices despite the growing surplus.
By the way, Saudi Arabia cut prices for January Arab Light crude oil to Asia to the lowest level in five years due to oversupply.
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