Oil Updates – prices steady as investors eye US inflation, OPEC report

Oil prices were little changed on Tuesday as investors eyed fresh drivers, including upcoming US inflation indicators and a monthly report from the Organization of the Petroleum Exporting Countries this week, according to Reuters.

Brent crude futures inched 4 cents higher to $83.40 a barrel at 6:15 a.m. Saudi time, while US West Texas Intermediate crude futures rose 5 cents to $79.17 a barrel.

The benchmark contracts settled higher on Monday on signs of improving demand in the US and China, world’s top two oil consumers.

“Oil prices were slightly higher overnight but remain in a broad holding pattern over the past week, with the lead-up to the upcoming US inflation data keeping some reservations in place,” said Yeap Jun Rong, market strategist at IG.

Investors are watching the US Consumer Price Index data due on Wednesday for clues to when the Federal Reserve will consider cutting interest rates.

“Ahead, the OPEC monthly oil report will be in focus to provide any updates on global oil demand, with some eyes on whether the previous optimistic guidance around the summer travel season will continue to hold,” said Yeap.

The latest OPEC monthly oil market report is due to come later Tuesday, based on the organization’s website.

Meanwhile, the market is also watching wildfires in remote western Canada that could disrupt the country’s oil supply.

Firefighters on Monday were racing to contain one blaze in British Columbia and two in Alberta near the heart of the country’s oil sands industry.

No operational disruptions had been reported. But Alex Hodes, analyst at energy brokerage StoneX, said Canada’s 3.3 million barrel per day production capacity is “very likely to be affected.”

The market also continued to react to bullish comments from Iraq’s oil minister, Hayyan Abdul Ghani, over the weekend, according to a note from ANZ analysts.

Ghani said on Sunday that Iraq would honor voluntary output cuts made by OPEC+, which includes the Organization of the Petroleum Exporting Countries, Russia and other non-OPEC producers, at its upcoming meeting on June 1.

That reversed course from his Saturday comments that Iraq had made enough voluntary reductions and would not agree to any new output cuts.