Oil Stable as Markets Monitor Middle East Tensions

Oil prices experienced slight changes on Thursday as the market tries to balance varying factors while keeping an eye on tensions in the Middle East and absorbing an increase in U.S. crude inventories. Brent crude futures fell by three cents to $90.10 a barrel as of 0100 GMT, and U.S. West Texas Intermediate (WTI) futures also dropped by three cents to $85.36 a barrel. Oil prices rose nearly two percent at settlement on Wednesday, driven by ongoing concerns over the conflict in the Middle East. However, prices lacked a clear direction on Thursday as investors viewed the rise in U.S. crude inventories as a sign of weak withdrawals and demand. The U.S. Energy Information Administration reported on Wednesday that crude inventories in the United States increased by 1.4 million barrels last week to 421.1 million barrels, surpassing an expected rise of 240,000 barrels predicted by analysts in a Reuters survey. Analysts at Citi noted on Thursday that "markets remain volatile with the ebb and flow of tensions in the Middle East, but the key fundamentals are seasonally weaker than expected, with surprisingly weak demand for products in the U.S." Investors are expected to continue monitoring developments in the Middle East amid fears that any escalation could disrupt oil markets and supplies. At the same time, macroeconomic concerns continued to impact oil demand outlooks, as eurozone business activity data surprisingly declined this month.