Oil prices fall slightly as Israel-Hamas ceasefire takes center stage By Investing.com

Investing.com – Oil prices fell slightly in Asian trading on Tuesday, extending recent losses after reports of some progress toward a ceasefire between Israel and Hamas led traders to price in a risk premium for crude.

Persistent concerns about weak demand, particularly from the largest oil importer China, also meant that crude oil prices remained largely low.

The price of oil expiring in October fell slightly to $77.61 a barrel, but was down slightly to $73.60 a barrel by 21:45 ET (01:45 GMT).

Israel accepts ceasefire proposal, Hamas response expected

US Secretary of State Antony Blinken said Israeli Prime Minister Benjamin Netanyahu had agreed to a preliminary American proposal for a ceasefire in the Gaza Strip, media reports said on Monday.

The focus now turned to a response from Hamas, although the Palestinian group had recently expressed doubts about a ceasefire, especially as Israel continued its offensive against Gaza in recent weeks.

Fearing that a prolonged conflict in the Middle East could affect oil prices, traders continued to factor a risk premium into oil markets, which helped the price briefly recover above $80 a barrel.

However, these concerns were mitigated by the lack of Iranian retaliation against Israel for the killing of a Hamas leader in Tehran in July.

Demand fears, China remains in focus

In addition to uncertainty about oil supplies from the Middle East, oil markets also suffered from ongoing concerns about demand, particularly from the largest importer, China.

China's central bank left its key interest rate unchanged on Tuesday after unexpectedly cutting rates in July.

The focus is clearly on signals of greater economic support from Beijing as the government struggles to stimulate growth.

China's oil imports fell for the second consecutive month in July as weak economic growth weighed on fuel demand in the country.

However, signs of stable U.S. fuel demand helped somewhat offset concerns about a slowdown in Chinese demand, as U.S. inventories shrank for several weeks in a row.

Oil markets are also waiting for further economic signals from the US this week, where he will speak at the Jackson Hole Symposium on Friday.