Oil prices fell $1 a barrel on Monday as investors remained cautious ahead of the Federal Reserve’s policy meeting later this week and Chinese production data that could deflect support from geopolitical tensions in the Middle East.
Brent crude futures traded down 98 cents, or 1.1 percent, at $89.50 a barrel by 00:01 GMT, while U.S. West Texas Intermediate (WTI) crude fell 1 dollar, or 1.2%, to 84.54 dollars per barrel.
Investors are looking at the results of the Federal Reserve’s monetary policy meeting on Wednesday, U.S. employment data and earnings from tech giant Apple Inc in CMC Markets, the world’s biggest oil consumer, for signs of slowing down depending on fuel needs, says expert Tina Teng.
Both Brent and WTI rose three percent on Friday after Israel stepped up its ground offensive against the Gaza Strip, raising concerns that the conflict could spread in the region, which accounts for a third of the world’s oil production.
“Despite an escalation in the Hamas-Israel war, the ground invasion was widely expected,” Teng said.
“The weekend playout signals no further expansion into a wider regional war, which caused a retreat in oil prices.”
Brent and WTI crude oil posted their first weekly decline in three weeks last week as the Middle East crisis worried investors and increased price volatility.
China is due to release manufacturing and services PMIs for October this week after the country announced a series of supportive policy measures.
Investors are hoping for new signs of economic stability and improving demand for fuel in China, the world’s largest importer and second-largest oil consumer.
