Oil Dips as demand outlook remains uncertain, Nigeria fuel tanker union begins strike

Oil prices fell on Tuesday, with an uncertain outlook for global demand knocking value off crude futures contracts, despite some risk premium from the Israel-Hamas conflict. Meanwhile Nigeria fuel tanker union begins strike to protest rising costs. Nigeria’s fuel tanker drivers began a strike on Monday over rising operational costs due to the recent second devaluation of the Naira currency within a year and over the state of the country’s roads, a union official said. The Nigerian Association of Road Transport Owners (NARTO), which groups thousands of truck owners and drivers responsible for fuel distribution in Nigeria, are pushing for higher freight charges from fuel marketers due to rising costs.

Brent futures dipped 22 cents or 0.26% to $83.34 a barrel. The six-month spread for Brent on Tuesday was also at its highest since October, in a sign of a tighter market. U.S. West Texas Intermediate crude for April delivery fell 26 cents, or 0.33%, to $78.20 a barrel, after earlier paring $1. The March WTI contract gained 36 cents or 0.45% to $79.55 a barrel ahead of its expiry during the session. There was no settlement for WTI on Monday due to a U.S. public holiday. Crude markets were “marginally lower” in “quiet trading over the Presidents’ Day holiday in the U.S. and as demand concerns offset ongoing Middle Eastern geopolitical tensions”, IG market analyst Tony Sycamore said in a note. Various countries are increasing efforts to secure a ceasefire between Israel and Hamas in Gaza as the threat of an Israeli assault on the city of Rafah looms. The U.N. has warned an assault “could lead to a slaughter”.