Oil down almost 4%, surrendering war premium amid Fed focus
Investing.com — Crude prices tumbled almost 4% on Monday as the market looked beyond the war in the Middle East to focus on what the Federal Reserve might do or say at its interest rate decision on Wednesday.
Concerns over how U.S. jobs numbers for October will turn out on Friday also kept oil traders on the edge.
New York-traded West Texas Intermediate, or WTI, crude for December delivery, settled at $82.31, down $3.23, or 3.8%.
The US crude benchmark has been in yo-yo mode for a week now, rising or falling more than 2% in a session, as the Israel-Hamas war raging on the Palestinian territory of Gaza had markets on the tenterhooks.
Last week, WTI finished down 3.6% and is due to finish October down almost 10% as things stand.
UK-origin Brent crude for December delivery settled at $87.45, down $3.03, or 3.4%. Last week, the global crude benchmark fell nearly 2%. It is on track to end October down 9%.
It would be remiss to say traders aren’t on the lookout for headlines on the war in the Middle East, after Israel launched at the weekend its much-anticipated ground assault on Gaza. Israeli troops and tanks attacked Gaza's main northern city from the east and west of the Palestinian enclave on Monday, Reuters reported.
But without any disruption to the oil traffic moving in waters around the battle zone, it was hard to maintain a war premium risk for crude just on grounds of proximity, said those in the know.
«There is a propensity for market users in all their guises to have at least some oil length going into the weekends and when the fear of conflict spread shows no validation come the early hours of Monday mornings' openings, that fear hedge is ordinarily unwound,» John Evans of oil broker PVM said in comments carried
Read more on investing.com
