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In the inaugural trading session of 2024, oil prices experienced a decline on Tuesday, 2 January 2024 driven by dimming interest rate cuts fever and a subsiding apprehension regarding potential disruptions in Red Sea supplies.

Investors adjusted their outlook on interest rates for the year, contributing to the downturn in oil prices. The prospect of reduced interest rates typically stimulates economic growth and oil demand by lowering consumer borrowing costs. Simultaneously, the strengthening of the dollar on Tuesday exerted additional downward pressure on oil. A robust dollar renders oil more expensive for investors using other currencies.

Brent crude settled at $75.89/barrel, down by $1.15/barrel or 1.5%.

WTI crude settled at $70.38/barrel, down by $1.27/barrel or 1.8%.