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Oil fluctuated near a five-month high as progress in ceasefire talks between Hamas and Israel helped cool a rally fuelled by risks to Russian and Iranian supplies.
Brent crude retreated slightly below US$81 a barrel as Qatar and Hamas said that negotiations with Israel have reached their final stages, building on earlier comments from Donald Trump and Joe Biden. That potentially eases a conflict that has buffeted global oil markets for more than 15 months.
The international benchmark had climbed more than 5 percent over the previous two sessions, while oil shipping rates surged the most in months on Monday, in response to the measures from Washington targeting about 160 tankers involved in Russian oil trade.
China’s state oil companies and large private refiners are snapping up crude cargoes from the Middle East as they hasten preparations for potential disruption in fuel supply from the unprecedented sanctions.
In Canada, meanwhile, Alberta Premier Danielle Smith warned of possible US tariffs once Donald Trump takes office next week, with no exemptions for oil, after meeting the president-elect in Florida. More than half of US crude imports come from Canada, most of it from Alberta.
Crude has seen a rampant start to the year as the multiplying supply risks deliver a further boost to a market that had already been lifted by falling US stockpiles and colder weather fanning demand.
While the full impact of the latest US sanctions package remains far from clear, it may drive a rerouting of global flows as users across Asia, including refiners in India and China, are forced to reach far and wide for replacement barrels. — Bloomberg.
Online Reporter