In early trading on Thursday, oil prices slightly declined due to mixed concerns about the U.S. economy and rising tensions in the Middle East.
Brent crude futures dropped by 9 cents to $86.95 per barrel, while U.S. West Texas Intermediate crude futures fell by 7 cents to $82.74 per barrel.
Analyst Toshitaka Tazawa pointed out the ongoing risk of conflicts spreading from Israel’s attacks on Gaza to nearby areas, despite recent easing tensions between Iran and Israel.
Israeli airstrikes continued in Gaza, adding to geopolitical instability, while economic indicators suggested a cooling of business activity in the U.S.
Data from April showed U.S. business activity at its lowest in four months, raising concerns about a potential slowdown in the world’s largest economy.
Oil transporting pipes (Via Trent Southee/Getty Images)
The U.S. Federal Reserve remains cautious due to unexpectedly high inflation and employment numbers, which have hindered efforts to achieve the central bank’s 2% inflation goal.
Upcoming economic reports, such as U.S. gross domestic product and personal consumption expenditures, will offer more clarity on the direction of U.S. interest rates.
Amid these economic uncertainties, the Energy Information Administration reported a surprise drop in U.S. crude oil inventories, indicating higher exports and a decrease in gasoline supplies.
However, the market reaction was subdued, with oil prices receiving only a brief boost before continuing their downward movement.
