HOUSTON: Oil prices fell on Friday on renewed hopes of a ceasefire in Gaza, while a strong dollar further weighed on the market.
Brent crude prices were down $1.11, or 1.3%, to $84 a barrel by 11:42 a.m. EDT. U.S. West Texas Intermediate crude futures dropped $1.08, or 1.3%, to $81.74.
U.S. Secretary of State Antony Blinken said on Friday a long-sought ceasefire between Israel and the Palestinian group Hamas was within sight.
“There remains some issues that need to be resolved, that need to be negotiated. We’re in the midst of doing exactly that,” Blinken told the Aspen Security Forum in Colorado.
The war in Gaza has led investors to price in a risk premium when trading oil, as tensions pose a threat to global supplies.
“Geopolitics is starting to ease just a little to bit so that ought to work in our favor, following the news of this ceasefire,” said Tim Snyder, chief economist at Matador Economics.
Oil steadies as economic slowdown signals contend with US rate-cut hopes
The U.S. dollar index climbed after stronger-than-expected data on the U.S. labor market and manufacturing earlier in the week, pressuring oil prices, said Phil Flynn, an analyst at Price Futures Group.
A stronger U.S. currency dampens demand for dollar-denominated oil from buyers holding other currencies.
Elsewhere, Chinese officials acknowledged on Friday the sweeping list of economic goals re-emphasised at the end of a key Communist Party meeting this week contained “many complex contradictions”, pointing to a bumpy road ahead for policy implementation.
China’s economy grew by a slower-than-expected 4.7% in the second quarter, official data showed, sparking concerns over its demand for oil.
A global tech outage on Friday disrupted operations in multiple industries, with airlines halting flights, some broadcasters going off the air and everything from banking to healthcare hit by system problems.
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