SINGAPORE: Oil prices slid on Monday after rising for four weeks, as the prospect of a ceasefire deal in Gaza eased geopolitical tensions in the Middle East, while investors assessed potential disruption to US energy supplies from Tropical Storm Beryl, according to Reuters. 

Brent crude futures were down 36 cents, or 0.4 percent, at $86.18 a barrel, as at 09:46 a.m. Saudi time. 

US West Texas Intermediate crude was at $82.71 a barrel, down 45 cents, or 0.5 percent. 

Talks over a US ceasefire plan aimed at ending the nine-month-old war in Gaza are under way, and being mediated by Qatar and Egypt. 

“If anything concrete comes from the ceasefire talks, it will take some of geopolitical bid out of the market for now,” said IG analyst Tony Sycamore based in Sydney. 

The ports of Corpus Christi, Houston, Galveston, Freeport and Texas City closed on Sunday to prepare for Hurricane Beryl, which is expected to make a landfall in the middle of the Texas coast between Galveston and Corpus Christi later on Monday. 

Port closures could bring a temporary halt to crude and liquefied natural gas exports, oil shipments to refineries, and motor fuel deliveries from those plants. 

“While this puts some offshore oil and gas production at risk, the concern when the storm makes landfall is the potential impact it could have on refinery infrastructure,” ING analysts led by Warren Patterson said in a note. 

“Any meaningful disruptions to Texas refinery operations will likely support refined product cracks.” 

IG’s Sycamore said there is also a good chance of US data showing another large weekly draw in US oil inventories amidst peak driving season, which will be supportive for oil prices. 

WTI gained 2.1 percent last week after data from the Energy Information Administration showed stockpiles for crude and refined products fell in the week ended June 28.  

“WTI has had a very good run, though, having rallied 15 percent from the early June low,” Sycamore said, adding that the benchmark could see strong resistance between $85.50 and $87.50 based on technical charts. 

The number of operating oil rigs in the US was unchanged at 479 last week, holding at its lowest since December 2021, Baker Hughes said in its weekly report on Friday. 

Oil prices were also supported last week by hopes of interest rate cuts following US data on Friday that showed inflation is easing and job growth slowing. 

Lower interest rates can boost economic activity and increase crude oil demand. 

Investors were also watching for any impact from elections in the UK, France and Iran last week on geopolitics and energy policies. 

France faced potential political deadlock after elections on Sunday threw up a hung parliament while Iranians chose Masoud Pezeshkian as their new president, a relative moderate who beat a hard-line rival in the election.

RIYADH: Capital flows and economic resilience have positioned the Association of Southeast Asian Nations financial markets in a relatively stable state, according to Qatar National Bank.  

In its latest economic commentary, QNB highlighted the robustness of large ASEAN economies — Indonesia, Thailand, Malaysia and the Philippines — against sudden changes in risk sentiment and capital flows.  

QNB’s analysis focused on assessing the external vulnerability of these economies, examining their external financing needs and the overall level of official foreign exchange reserves.  

The commentary noted that strong FX reserves act as a crucial buffer to absorb external shocks, and these reserves should be evaluated in context with short-term external financing requirements and other macroeconomic indicators.  

Thailand remains well positioned to handle sudden capital flow changes, even with international tourism not yet back to pre-pandemic levels.  

The country continues to run sizable current account surpluses, which have enabled it to accumulate $221 billion in official FX holdings, covering 209 percent of the International Monetary Fund reserve adequacy metric.

The IMF reserve adequacy metric assesses a country’s FX reserves to ensure they can cover short-term external debt, potential trade imbalances, import costs and capital flight risks, therefore maintaining financial stability and investor confidence.  

Malaysia, a major producer of manufacturing goods and commodities, also shows resilience. The country has consistently run current account surpluses as a net exporter of oil and soft commodities.  

Despite tighter reserve adequacy metrics compared with Thailand, Malaysia’s central bank holds $113 billion in FX holdings, covering 115 percent of the IMF reserve adequacy metric.  

The Philippines, as a net external borrower with current account deficits, faces different challenges. The country’s large trade deficit, partially offset by remittances from expatriates, is expected to amount to about 2 percent of gross domestic product.  

However, the Philippines holds $103 billion in official FX reserves, covering 196 percent of the IMF reserve adequacy metric, providing a significant cushion against external shocks.  

Indonesia, traditionally the most exposed to external shocks of the large ASEAN countries, has returned to a current account deficit position after a brief period of surplus driven by a commodity boom.  

The country is expected to run a current account deficit of about 1 percent of GDP this year, with the deficit likely to persist due to ongoing capital expenditure projects. 

Indonesia’s official FX reserves amount to $136 billion, covering 112 percent of the IMF reserve adequacy metric.