Crude oil prices inched higher during the early European session due to increased risks of a flare-up in confrontations in the Middle East.
Traders could remain cautious as new developments could emerge.
The region could remain at the center of the market’s attention. Optimism that potential U.S. interest rate cuts could spur economic growth and increase fuel consumption has also supported oil prices.
Lower interest rates could stimulate economic activity and support oil demand. In this regard, traders could continue to monitor US data to assess the size of the expected interest rate cuts.
However, a slowdown in consumer spending could curtail oil demand. In this regard, oil demand forecasts have been revised down and could affect prices.
Economic activity in China continued to slow down and could affect demand for oil and oil products from the country. Oil prices could also face limits on their upside potential after an unexpected 1.4-million-barrel rise in U.S. crude inventories went contrary to expectations.
