Oil Prices Fall on Israel-Hamas Ceasefire By Investing.com

Investing.com– Oil prices edged lower in Asian trade on Tuesday, extending recent losses, as reports of some progress toward an Israel-Hamas ceasefire saw traders take a risk premium out of crude.

Lingering concerns about weak demand, particularly in China, the main oil importer, also kept crude prices largely subdued.

which expires in October was down slightly at $77.61 a barrel, after falling to $73.60 a barrel by 21:45 ET (01:45 GMT).

Israel accepts ceasefire proposal, Hamas response expected

US Secretary of State Antony Blinken said Israeli Prime Minister Benjamin Netanyahu had agreed to a preliminary US proposal for a ceasefire in Gaza, media reported on Monday.

The focus has now turned to a response from Hamas, although the Palestinian group has recently expressed doubts about the ceasefire, especially as Israel has maintained its offensive against Gaza in recent weeks.

Fears that a protracted conflict in the Middle East could hurt oil prices saw traders maintain a risk premium in oil markets, helping prices briefly recover above $80 a barrel.

But those concerns were tempered by the lack of Iranian retaliation against Israel for the killing of a Hamas leader in Tehran in July.

Demand fears, China remains the center of attention

In addition to uncertainty over supplies from the Middle East, oil markets were also weighed down by lingering concerns about demand, particularly in China, the main importer.

China’s central bank kept its benchmark unchanged on Tuesday after unexpectedly cutting interest rates in July.

The focus is squarely on signals of economic support from Beijing as the government scrambles to shore up growth.

China’s oil imports fell for a second straight month in July as weak economic growth hurt demand for the country’s fuel.

But signs of steady U.S. fuel demand helped somewhat offset concerns about slowing demand in China as U.S. stockpiles shrank for several straight weeks.

Oil markets are also watching for more economic signals from the US this week, due to speak at the Jackson Hole Symposium on Friday.