Oil futures moved lower early Tuesday as U.S. traders prepared to return from the Presidents Day holiday weekend, while downside was seen limited by continued worries over the Middle East as Iran-backed Houthi rebels continued to attack cargo ships.
Price moves
-
West Texas Intermediate crude for March delivery
CL.1,
-0.45%CLH24,
-0.45%
fell 31 cents, or 0.4%, at $78.88 a barrel on the New York Mercantile Exchange. April WTI
CL00,
-1.07%CLJ24,
-1.07%,
the more actively traded contract, was off 87 cents, or 1.1%, at $77.59 a barrel. WTI futures didn’t settle Monday due to the holiday, but closed Friday at the highest since Nov. 6 based on the front-month contract. -
April Brent crude
BRN00,
-0.87%BRNJ24,
-0.87%,
the global benchmark, was off 79 cents, or 0.9%, at $82.77 a barrel after ending Monday at its highest since Nov. 6.
Market drivers
Yemen’s Houthi militants said they attacked the Rubymar cargo vessel in the Gulf of Aden, news reports said. The vessel was seen at risk of sinking. A U.S.-led coalition has led a number of airstrikes against Houthi targets in response for drone and missile attacks in the region, which have forced shippers to avoid the Red Sea. The Houthis vowed to continue their attacks.
Market participants may show renewed concern toward potential supply disruptions, said Ricardo Evangelista, senior analyst at ActivTrades, in a note.
“With concerns regarding demand gradually waning and geopolitical tensions persisting, there is potential for further escalations in oil prices on the horizon,” he said.
Crude oil prices rallied last week as investors weighed the outlook for interest-rate cuts by the Federal Reserve, tensions in the Middle East and uncertainty about the outlook for crude demand.
China on Tuesday made its largest ever cut to mortgage rates, as authorities attempt to support the country’s struggling property sector.
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