March 22, 2024 (MLN): Global oil prices extended their downward journey on Friday due to a stronger dollar and the potential for a Gaza ceasefire, which would alleviate supply tensions.
Brent crude traded near $84.64 per barrel, down by 0.36% on the day.
While West Texas Intermediate crude (WTI) was at $80.36 per barrel, down by 0.39% on the day.
Oil was trading lower on reports of a U.N. draft resolution calling for a ceasefire in Gaza and as another round of profit-taking kicked in, IG analyst Tony Sycamore said in a note, as Reuters reported.
U.S. Secretary of State Antony Blinken said on Thursday he believed talks in Qatar could reach a Gaza ceasefire agreement between Israel and Hamas, easing geopolitical risks in the region.
Blinken met Arab foreign ministers and Egypt's President Abdel Fattah El-Sisi in Cairo as negotiators in Qatar centered on a truce of about six weeks.
In the United States, the world's top oil consumer, gasoline product supplied, a proxy for demand, slipped below 9 million barrels for the first time in three weeks, indicating a possible slowdown in crude demand.
But consultancy FGE said preliminary weekly data for the first half of March that showed on-land crude and main product stocks at major oil hubs globally falling by almost 12m barrels, compared with the 2015 to 2019 average draw of 6m barrels, could be bullish for oil.
Meanwhile, the U.S. dollar, which trades inversely with oil prices, strengthened after the Swiss National Bank's surprise interest rate cut bolstered global risk sentiment.
A stronger dollar makes oil more expensive for investors holding other currencies, dampening demand.
