Oil firms as doubts about demand recede amid the Middle East tensions

Brent crude, the international standard, stabilized on Monday unchanged at about $83 a barrel, as the impact of the continuing conflict in the Middle East offset the impact of doubts about demand.

According to Reuters, by 1434 GMT, Brent crude futures fell nine cents to $83.38 per barrel.

US West Texas Intermediate crude futures for March, which expire on Tuesday, rose 20 cents to 79.39 in weak trading, while crude contracts for April fell 12 cents to $78.34 a barrel.

Brent crude futures rose 1.5 percent and West Texas Intermediate crude futures rose 3 percent last week, reflecting an increased risk of the conflict expanding in the Middle East.

These gains were limited by a slowdown in demand forecasts from the International Energy Agency and a higher-than-expected rise in the US producer price index in January, which led to increased concerns about inflation.

Concerns about demand worsened on Friday when policymakers at the Federal Reserve (US central bank) signaled the need for “patience” regarding expectations of interest rate cuts.

Markets are still awaiting the trend of demand from China after the country’s return from the week-long Lunar New Year holiday, while transactions remained weak due to the Presidents Day holiday in the United States.

The conflict in the Middle East continued to rage over the weekend, and the Israeli attacks led to the second largest hospital in the Gaza Strip being unable to operate.

A British-registered cargo ship became at risk of sinking in the Gulf of Aden on Monday after an attack by the Houthis. Another US-owned cargo ship also reported two missile attacks in the Gulf of Aden on Monday.

Analysts at ANZ Research said in a note that the Organization of the Petroleum Exporting Countries (OPEC) would be able to cover “most levels of disruption,” noting that spare capacity reached an eight-year high of 6.4 million barrels of oil per day.