Oil prices remained steady as the market evaluated growing geopolitical risks in Europe and the Middle East, as well as the impact of an approaching hurricane in the Caribbean. West Texas Intermediate was trading above $81 a barrel, following a 6% increase in June. Despite this increase, oil prices remained within a narrow range of about $3, with both positive and negative factors already factored in.
In France, Marine Le Pen’s National Rally made gains in legislative elections, adding to political risks in the region. Meanwhile, Israeli Prime Minister Benjamin Netanyahu reiterated his commitment to fighting Hamas, while conflict between the group and Hezbollah continues to escalate. Hurricane Beryl is expected to hit the Caribbean on Monday, with concerns about potential disruptions to US oil operations in the Gulf of Mexico.
OPEC+ has stated that any plan to increase oil production will depend on market conditions, providing support to prices. Money managers have been increasing investments in US crude futures, and key spreads point to tight supplies in the market. Geopolitical tensions, the upcoming US election, and China’s economic activity are expected to be key areas of focus in the coming months.
A private gauge of China’s manufacturing activity showed expansion in June, diverging from official data showing a contraction. The outlook for oil prices remains uncertain, with a mix of geopolitical tensions and economic data influencing market movements.