Oil prices slip as geopolitical tension in Middle East eases

By Gokce Kucuk Topbas

Oil prices on Monday fell almost 2% over easing supply concerns as tensions in the Middle East eased after Israel withdrew soldiers from parts of Gaza and indirect negotiations between Israel and Hamas continued for a cease-fire in the Palestinian enclave.

International benchmark Brent crude traded at $91.91 per barrel at 1.30 p.m. local time (1030 GMT) on Friday, a 1.56% drop from the closing price of $89.74 per barrel in the previous trading session.

The American benchmark West Texas Intermediate (WTI) traded at $85.57 per barrel at the same time, a 1.54% decline from the previous session that closed at $86.91 per barrel.

Prices started the week on a declining trend over the increasing prospect of a cease-fire between Israel and Hamas after a delegation from the Palestinian group Hamas held discussions on Sunday with the head of Egyptian intelligence in Cairo on efforts to reach a cease-fire in the Gaza Strip and a hostage swap deal with Israel.

"A delegation from the movement arrived in Cairo and met with (Egyptian intelligence chief) Abbas Kamel," Hamas said in a statement.

"The delegation emphasized Hamas's demands, its desire to reach an agreement that would achieve a complete cessation of hostilities, the withdrawal of occupation forces from the Gaza Strip, the free return of displaced people to their regions and places of residence, the relief of our people and the beginning of reconstruction of what was destroyed by the occupation," it said.

Limiting further price declines, Saudi Arabia, recognized globally as the leading exporter of oil, announced an increase in the official selling prices (OSPs) for all its crude grades destined for Asia in May.

This decision comes at a time when the market is experiencing a tightening in the supply of heavy crude oil, aligning closely with market expectations.