Oil Prices Steady Amid Middle East Supply Fears, Diplomatic Talks with Iran

Oil prices remained relatively stable despite concerns over supply disruptions in the Middle East. The possibility of diplomatic talks between the US and Iran has countered some of these fears, although geopolitical tensions persist. Saudi Arabia issued air raid alerts for Riyadh and Yanbu over the weekend, while General Brad Cooper reported improved shipping conditions through the Strait of Hormuz.

The market is also watching repairs to Saudi Arabia's East-West pipeline, which was damaged in an attack earlier this month. This has led to concerns about supply disruptions, particularly given the fact that Saudi Aramco notified European refiners it would not supply next month's long-term contract volumes due to pipeline operations.

Conflicts across the Middle East and Europe are driving up energy prices and contributing to global inflation pressures. The Federal Reserve raised its benchmark interest rate last week, with Minneapolis Fed President Neel Kashkari noting that recent price pressures were spreading beyond the oil shock into the broader economy.