Oil prices see uptick demand concerns remain

Crude oil futures recovered due to concerns over supply disruptions from tropical Storm Francine.

Market participants have adjusted positions as some Gulf of Mexico facilities halted operations ahead of the storm.

The market also reacted to larger-than-expected drawdown in API crude inventories which dropped by 2.79 million barrels.

However, the oil market could remain under pressure as global demand worries could overshadow any potential price rebound. Market sentiment remains cautious due to OPEC+’s recent downward revisions and ongoing concerns about slowing global demand.

Looking ahead, U.S. inflation data expected today could trigger volatility in oil prices. Core inflation is forecast to remain unchanged at 3.2% year-on-year, with overall inflation easing slightly to 2.6% in August. However, if U.S. CPI data ticks up, oil prices could see downside risks.