Oil prices fall as Gaza ceasefire talks outweigh summer fuel demand

Oil prices settled lower on Friday as the rising possibility of a ceasefire deal in Gaza outweighed strong summer fuel demand and potential supply disruptions from Gulf of Mexico hurricanes, News.Az reports citing Reuters.

Brent crude futures settled down 89 cents, or 1.02% lower, to $86.54 a barrel, after reaching their highest since April earlier in the session. U.S. West Texas Intermediate (WTI) crude futures settled at $83.16 a barrel, down 72 cents, or 0.9%.

For the week, Brent rose 0.4%, while WTI futures posted a 2.1% rise.

The head of Israel's Mossad has returned from Doha after an initial meeting with mediators trying to reach a Gaza ceasefire and hostage release deal, and negotiations will resume next week, Prime Minister Benjamin Netanyahu's office said on Friday.

Netanyahu's office said in a statement that gaps remain between the sides.

“Obviously a breakthrough there would help calm the waters”, said John Kilduff, partner at Again Capital. An easing of the Middle Eastern conflict reduces the risk premium of barrels out of the region and weighs on oil prices.

WTI did not settle on Thursday due to the Independence Day holiday, giving way to thin trading, but prices have risen this week on strong summer oil demand expectations in the U.S.

The U.S. Energy Information Administration (EIA), on Wednesday, reported a much larger-than-expected 12.2 million barrel inventories draw last week, compared with analyst expectations for a draw of 700,000 barrels.

On the supply side, Hurricane Beryl, a Category 2 storm, made landfall in Mexico, after killing least 11 people in the Caribbean, tearing through buildings and power lines across several Caribbean islands.

News.Az