Oil Falls, Markets Caution
Oil prices weakened after a four-day rally as investors awaited clearer signals on supply, while monitoring the broader market impact of US President Donald Trump's move to remove a Fed chairman. In recent trading, Brent fell near $67/barrel, while WTI was below $65.
On the policy front, the US Department of Homeland Security (DHS) issued a draft notice to double tariffs on all Indian imports starting Wednesday as a penalty for purchases of Russian oil. This move was described as part of a broader effort to push for a Russia-Ukraine peace deal. Meanwhile, Trump hinted at additional tariffs and sanctions if negotiations did not progress, while the Indian government criticized the "secondary tariffs" as unfair.
In the broader market, stocks and risk assets weakened amid concerns about the independence of the central bank following the dismissal of Lisa Cook, just as data showed signs of economic weakness, including in the labor market. Throughout August, oil prices moved within a narrow range as market participants weighed the impact of US tariffs and the long-term consequences of a series of OPEC+ supply increases. The IEA previously warned of the risk of a record surplus next year as demand growth slows while supply continues to swell.
According to Robert Rennie of Westpac, if India's tariffs are indeed doubled, the market will again question Russian oil flows and potentially retest the $70 area in the short term. The market is also focusing on Ukraine's attack on Russian energy infrastructure, which adds to supply uncertainty. Most recently, Brent October crude futures fell 0.5% to $68.49/barrel (11:37 a.m., Singapore), while WTI October crude futures fell 0.5% to $64.47/barrel. (ayu)
Source: Newsmaker.id
