Oil futures fell sharply on Thursday, February 1st, as news of Gaza ceasefire talks emerged.
Traders reacted to reports that Hamas considered a ceasefire proposal from Israel, aiming to resolve the conflict.
Earlier rumors suggested Qatar denied an existing ceasefire agreement, affecting commodity prices temporarily.
WTI crude for March and Brent for April dropped 2.68% and 2.30%, respectively.
The decline occurred on two major trading platforms: Nymex for WTI and the Intercontinental Exchange for Brent.
This downturn also reflected market responses to Federal Reserve Chairman Jerome Powell’s remarks.
He hinted at keeping US interest rates unchanged in March, influencing broader market sentiment.
Moreover, US manufacturing PMI data for January indicated slight economic improvement but remained below the growth threshold.
Such economic indicators, alongside geopolitical developments, drive commodity price volatility.
Analysts from Citi predict geopolitical tensions, like drone attacks on Russian oil facilities, might temporarily boost oil prices.
However, they expect weakening market fundamentals to apply downward pressure over the medium term.
The situation underscores the impact of geopolitical events and economic indicators on oil prices.
It highlights the interconnected nature of global politics, economic policies, and commodity markets.
This dynamic illustrates how international events and policy decisions can sway market trends, affecting global oil prices and economic outlooks.