Oil prices rise as Middle East disruptions persist; US payrolls awaited
Investing.com-- Oil prices rose in Asian trade on Friday as focus remained on supply disruptions in the Middle East, although gains were somewhat limited in anticipation of key U.S. payrolls data.
The ongoing conflict in the Red Sea saw some escalation this week as U.S.-led forces clashed with the Iran-aligned, Yemeni Houthi group. The Israel-Hamas also war raged on, now appearing to have spilled over into Lebanon.
On the oil supply front, Syria halted production at its biggest oilfield due to protests in the region, taking about 300,000 barrels per day of supply offline.
While concerns over some disruptions to Middle East supplies drove a recovery in crude this week, the rebound was cut short by data showing a massive build in U.S. oil product inventories in the final week of 2023. The reading indicated that demand remained weak in the world’s largest fuel consumer, while local markets were also well-supplied.
Brent oil futures expiring March rose 0.6% to $78.02 a barrel, while West Texas Intermediate crude futures rose 0.7% to $72.83 a barrel by 20:08 ET (01:08 GMT). Both contracts were set to end the week about 1% higher after logging bruising losses in 2023.
A rebound in the dollar also weighed on oil prices, as the greenback raced to over three-week highs on growing uncertainty over the Federal Reserve’s plans for interest rate cuts.
While the Fed signaled it will cut interest rates in 2024, it did not specify the timing or scale of the cuts. Traders were also seen slightly winding back expectations that the Fed will begin trimming rates by as soon as March 2024.
Nonfarm payrolls data for December, which is due later on Friday, is expected to offer more cues on the path of interest rates, given that labor market
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