© Reuters.
Investing.com – Oil prices rose in Asian trading on Friday, but posted sharp losses this week as traders priced in a lower risk premium from the Israel-Hamas war, while rising Treasury yields and weak economic data also fueled demand concerns.
Signs of a possible de-escalation of the war led traders to reject bets that the war would attract other countries in the Middle East and disrupt oil supplies in the crude-rich region.
Several diplomatic missions in Israel worked to prevent a planned ground attack on Gaza and negotiate the return of about 200 hostages held by Hamas.
Still, Israeli forces carried out an attack on the northern Gaza Strip overnight, while Prime Minister Benjamin Netanyahu reiterated his commitment to a major ground assault on the region.
But traders had difficulty estimating how much the war would affect oil supplies because Middle Eastern crude shipments were little changed in the first 20 days of the conflict.
rose 0.5% to $88.42 a barrel, while rising 0.6% to $83.68 a barrel by 8:49 p.m. ET (00:49 GMT). Both contracts fell about $2 a barrel on Thursday and are expected to lose between 4% and 5% this week – their first weekly loss in three weeks.
Fed uncertainty and mixed economic signals are keeping oil markets on tenterhooks
Year-to-date strength heading into next week also put some pressure on oil markets. While the central bank is widely expected to keep interest rates on hold, Fed officials have also signaled longer-term higher interest rates, which could potentially curb crude oil demand in the coming year.
Treasury yields soared ahead of the Fed meeting, which also caused unrest in the markets.
Still, figures released Thursday showed the U.S. economy grew significantly more than expected in the third quarter, raising hopes that oil demand in the world’s largest fuel consumer will remain stable in the coming months.
But that followed a string of weak economic data from the euro zone as slowing business activity prepared the bloc for a recession this year.
Weak signals on oil demand in China also had a negative impact, as Beijing proposed capping domestic oil refining to curb carbon emissions. This largely offset news of further stimulus measures in the country.
Source : www.investing.com