Oil Sinks Near Lowest in a Month, Testing Key Technical Level

Oil Sinks Near Lowest in a Month, Testing Key Technical Level
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(Bloomberg) — Oil slid near its lowest price in a month as the potential for a cease- in the Middle East eased geopolitical tensions.

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West Texas Intermediate settled below $82 a barrel, testing its 50-day moving average of about $81.80. The level has provided technical support for prices, and a decisive drop below it may accelerate selling. Earlier, oil was pressured by a potential agreement between Israel and to release hostages, a move that may de-escalate conflict in the region.

Meanwhile, continued signs of elevated inflation — including an acceleration in a broad gauge of US labor costs — are weighing on the outlook for crude demand. Economic data in Europe showed the region exited recession, but inflation has also proven sticky.

Crude hardened a rocky April after surging to the highest since October following Iran’s unprecedented attack on Israel. While OPEC+ supply curbs are also bolstering prices, uncertainty over US monetary policy and softness in some fuel markets like diesel are adding headwinds.

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US Secretary of State Blinken, in an ongoing visit to the Middle East, urged leaders of the Hamas militant group — designated a terrorist organization by the US and the European — to quickly reach a decision on Israeli conditions for a cease-fire.

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