Oil little changed as investors eye Gaza ceasefire and Ukraine talks stall

SINGAPORE, Oct 9 (Reuters) – Oil prices were little changed on Thursday as investors weighed a ceasefire deal in Gaza, which could ease geopolitical tensions in the Middle East, against deadlocked peace talks in Ukraine, which could maintain sanctions on Russia and curb its exports.

Brent crude futures were up 2 cents at $66.27 a barrel by 0629 GMT. U.S. West Texas Intermediate crude fell 1 cent to $62.54.

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Israeli Prime Minister Benjamin Netanyahu said he would convene his government to approve the ceasefire agreement. The signing of the agreement is expected to take place on Thursday at noon Israel time (09:00 GMT).

“The devil is always in the details, and I would avoid speculating for now due to the many false starts we have witnessed in the past,” Claudio Galimberti, chief economist at Rystad Energy, said in a note.

The war in Gaza supported oil prices as investors weighed the potential risk to global supplies if the fighting developed into a wider regional conflict.

Michael McCarthy, CEO of investment platform Moomoo Australia and New Zealand, said the Gaza ceasefire is unlikely to change oil supplies in the Middle East because OPEC+ has failed to meet its production increase targets.

“As long as the war in Ukraine continues, the geopolitical risk premium is bound to remain high, because threatened Russian oil production remains high,” Rystad’s Galimberti said.

Meanwhile, the weekly total of U.S. petroleum products supplied, an indicator of U.S. oil consumption, increased last week to 21.990 million barrels per day, the highest since December 2022, according to an Energy Information Administration report released Wednesday.

JP Morgan analysts said global oil demand started on a weaker note in October as many consumption indicators, including container arrivals at the Port of Los Angeles, truck toll mileage in Germany and container throughput in China, pointed to a moderation in activity.

Global oil demand averaged 105.9 million b/d in the first seven days of October, up 300,000 b/d from last year’s level but down 90,000 b/d from JP Morgan’s estimates, its analysts said in a client note.

The pace of building global inventories of crude and derivatives has also slowed, increasing by 8 million barrels last week, the slowest increase in the past five weeks, they said.

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