TOKYO- Oil prices steadied in early trade on Wednesday, with markets assessing the potential impact of a ceasefire deal between Israel and Hezbollah, and ahead of Sunday’s OPEC+ meeting.
Brent crude futures fell 2 cents to $72.79 a barrel while US West Texas Intermediate crude futures were at $68.73 a barrel, down 4 cents, or 0.1 percent.
Both benchmarks settled lower on Tuesday after Israel agreed to a ceasefire deal with Lebanon’s Hezbollah.
A ceasefire between Israel and Hezbollah will take effect on Wednesday after both sides accepted an agreement brokered by the United States and France, US President Joe Biden said on Tuesday.
The accord cleared the way for an end to a conflict across the Israeli-Lebanese border that has killed thousands of people since it was ignited by the Gaza war last year.
Israeli Prime Minister Benjamin Netanyahu said he was ready to implement a ceasefire deal with Lebanon and would “respond forcefully to any violation” by Hezbollah.
“Market participants are assessing whether the ceasefire will be observed,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan Securities. “We expect WTI to trade within the range of $65-$70 a barrel, factoring in weather conditions during the Northern Hemisphere’s winter, a potential increase in shale oil and gas production under the incoming Donald Trump administration in the US and demand trends in China,” he said.
