WTI moves below $83.50 amid expectations of increased supply, US NFP awaited

• WTI price inches lower as recent data showed that OPEC increased production in June.
• Negotiations between Israel and Hamas showing potential for improvement exert downward pressure on Oil prices.
• US Nonfarm Payrolls are expected to increase by 190,000 new jobs, down from the previous reading of 272,000.

West Texas Intermediate (WTI) Oil price trades around $83.50 per barrel at the time of writing. Crude Oil prices remain tepid as recent data showed that the Organization of Petroleum Exporting Countries (OPEC) increased production in June for the second consecutive month. This indicates a potential easing of tight Oil markets in the coming months, exerting downward pressure on crude Oil prices.

On the geopolitical front, Israeli Prime Minister Benjamin Netanyahu informed US President Joe Biden on Thursday that he has decided to send a delegation to resume stalled negotiations on a hostage release deal with Hamas. A source within the Israeli negotiating team said that there is a real chance of reaching an agreement after Hamas made a revised proposal regarding the terms of the deal, as reported by Reuters. This may ease the supply threat from the Middle East, putting pressure on the Oil prices.

US Oil demand rose this week on strong summer demand expectations in the United States, the world's largest oil consumer. According to the American Automobile Association (AAA), travel during this period is projected to be 5.2% higher than in 2023, with car travel alone rising by 4.8% compared to the previous year, Reuters reports.

The weaker economic US data has led to speculation that the Federal Reserve (Fed) might consider lowering borrowing costs in 2024. Reduced borrowing costs can stimulate economic growth in the United States, potentially boosting demand for Oil and providing support for crude Oil prices.