Lagos — Crude oil futures stabilized to a certain extent but could continue to see volatility risks. On the supply side, negotiations over Iran’s nuclear program appear stalled, limiting the downward pressure on the market. Without a deal, U.S. sanctions on Iranian oil exports remain in place, preventing a potential increase in crude volumes available on the market.
Economic concerns, especially surrounding China and the U.S., remain a source of risks. While Moody’s recent downgrade of the U.S. sovereign credit rating weighed on market sentiment, slowing industrial output and retail sales in China raised doubts about future oil demand.
In this regard, traders could turn to new economic data releases, including US crude inventory data, to assess the demand in the country. As a result, the market could see increased volatility in the case of divergence with expectations. US PMI data could also affect the market later this week.
*Inki Cho Financial Markets Strategist Consultant to Exness
