By Scott DiSavino
NEW YORK (Reuters) -Oil prices were stable on Monday as the market awaited further clues on the likely path of U.S. interest rates in the wake of cautious comments from U.S. Federal Reserve officials, even as inflation shows signs of cooling.
Brent futures fell 2 cents to $83.96 a barrel by 11:10 a.m. EDT (1510 GMT), while U.S. West Texas Intermediate (WTI) crude rose 5 cents, or 0.1%, to $80.11.
U.S. inflation data through the first months of 2024 has been disappointing, the Fed’s vice-chair for supervision, Michael Barr said, leaving the central bank short of the evidence it needs to ease monetary policy.
Atlanta Fed President Raphael Bostic said it will take a while for the U.S. central bank to be confident that inflation is on track back to the bank’s 2% goal.
Several other Fed speakers are due to speak on Monday and later in the week. Markets will also focus on minutes of the Fed’s last meeting, which are due on Wednesday.
Borrowing costs in the U.S. have been stuck at high levels since last July in an effort to curb sticky inflation. The timing of rate cuts, which could spur economic growth and oil demand, is in sharp focus.
UNFAZED BY WORLD EVENTS
The market, however, appeared unfazed by political uncertainty in two major oil producing countries after Iran’s president died in a helicopter crash and Saudi Arabia’s crown prince deferred a trip to Japan because of the health of his father, the king.
Iranian oil policy should be unaffected by the president’s sudden death because Supreme Leader Ayatollah Ali Khamenei holds ultimate power with the final say on all state matters.
In Saudi Arabia, the market is already accustomed to Crown Prince Mohammed Bin Salman’s leadership in the energy sector, said Saul Kavonic, an energy analyst at MST Marquee.
“Continuity in Saudi strategy is expected regardless of this health issue,” he said.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, together known as OPEC+, are scheduled to meet on June 1.
“The market also appears increasingly numb to developments on the geopolitical front, likely due to the large amount of spare capacity OPEC is sitting on,” said Warren Patterson, head of commodities strategy at ING.
Data showed that Saudi Arabia’s crude oil exports rose for a second consecutive month in March, reaching their highest in nine months.
Russia remained China’s top oil supplier in April for a 12th month, with volumes rising 30% from a year earlier as refiners continued to cash in discounted shipments, while supplies from Saudi Arabia fell a quarter on higher prices.
In Russia, the Slavyansk oil refinery in the Krasnodar region was damaged by a drone attack at the weekend.
(Reporting by Scott DiSavino In New York, Natalie Grover in London, Deep Vakil in Bengaluru, Colleen Howe in Beijing and Florence Tan in Singapore; editing by Jan Harvey, David Goodman and Susan Fenton)
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