Oil prices hovered near two-week highs on Monday as global markets anticipated a possible U.S. Federal Reserve interest rate cut that could boost economic growth and strengthen energy demand. Brent crude futures edged up 4 cents to $63.79 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 7 cents to $60.15 a barrel during early Asian trading. Both benchmarks ended Friday at their highest levels since November 18, reflecting improving market sentiment.
Investor expectations are firmly tilted toward a quarter-point rate cut, with LSEG data showing an 84% probability ahead of the Federal Reserve’s two-day meeting. However, analysts warn that the decision may be one of the most divisive in recent years, making the central bank’s forward guidance especially critical for commodity markets.
Geopolitical tensions continue to add uncertainty to global oil supply. Progress in Ukraine peace negotiations remains slow, with major disagreements over security guarantees for Kyiv and the status of Russian-occupied regions. According to ANZ analysts, the outcomes of these discussions—and former President Donald Trump’s push to influence negotiations—could shift global oil supply by more than 2 million barrels per day, depending on how the conflict evolves.
Additional pressure is coming from Western policy discussions, as the Group of Seven nations and the European Union consider replacing the existing price cap on Russian oil with a full maritime services ban. Such a move could significantly restrict exports from Russia, the world’s second-largest oil producer.
At the same time, Washington has intensified its stance against Venezuela, targeting alleged drug-smuggling operations and issuing threats of military action against President Nicolás Maduro’s government. Meanwhile, Chinese independent refiners have increased purchases of sanctioned Iranian crude, using newly issued import quotas to draw from onshore storage and help ease an ongoing supply overhang.
These combined economic and geopolitical forces continue to shape a volatile but upward-leaning outlook for global oil markets.


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