On August 20th, in the Asian market, influenced by the possibility of a ceasefire agreement in the Middle East, international oil prices fluctuated downwards.

As of the time of writing, Brent crude oil futures fell by 12 cents, $2.02, or 0.15%, to $77.54 per barrel; the WTI crude oil futures for the previous month, which expired on Tuesday, fell by 14 cents or 0.2%, to $74.23 per barrel; the more active next month contract fell by 15 cents or 0.2%, to $73.52 per barrel.

Yesterday, US Secretary of State Antony Blinken revealed that Israel has accepted a proposal to bridge the differences that hindered the ceasefire in Gaza and the release of hostages. He called on Hamas to do the same but did not specify whether the organization's concerns have been resolved.

In Tel Aviv, Blinken told reporters, "In a very constructive meeting with Prime Minister Netanyahu today, he confirmed to me that Israel supports this bridging proposal." Blinken did not disclose the content of the proposal and said, "The next important step is for Hamas to say 'Yes'." However, he added that even if Hamas accepts this proposal, negotiators will work in the coming days to reach a "clear understanding about the implementation of the agreement."

However, with the Palestinian Islamic organization announcing a suicide bombing attack in Israel after many years, and medical staff stating that the Israeli army killed at least 30 Palestinians in the Gaza Strip on Monday, the negotiations between the two sides are once again at an impasse, and people even began to worry about a larger-scale war.

On the supply side, according to two engineers working at the Sharara oilfield in Libya, the production of the Sharara oilfield, which was originally shut down, has rebounded to 85,000 barrels/day, alleviating supply concerns in the region. On August 7th, the Sharara oilfield was blocked by protesters. Under normal circumstances, the oilfield's production capacity can reach 300,000 barrels/day, and it has now recovered nearly one-third.

In the United States, according to preliminary surveys by information providers, it is expected that the US crude oil inventory will decrease by 2.9 million barrels last week. The survey also shows that the vast majority of economists believe that the possibility of the United States falling into a recession is not great. Under ideal circumstances, the Federal Reserve will cut interest rates by 25 basis points at each of the remaining three meetings in 2024, one more than the forecast last month.

Federal Reserve members Mary Daly and Austan Goolsbee said over the weekend that there might be a policy easing in September. In addition, the minutes of the last interest rate meeting to be released this week are also expected to reveal a dovish outlook.

At present, the market is focusing on the upcoming Jackson Hole Central Bank Annual Meeting. At 10 am on August 23rd, Eastern US time, Federal Reserve Chairman Jerome Powell will deliver a speech, which may reveal more information about inflation, employment, and Federal Reserve policy.

On the demand side, concerns about China's sluggish economy have hit oil prices. After experiencing a disappointing second quarter, the world's second-largest economy further lost momentum in July: new housing prices fell at the fastest pace in nine years, industrial output slowed down, exports and investment growth declined, and unemployment rates rose.

As for the recent labor dispute between the two major railway companies in Canada, it is currently not likely to reduce Canada's oil exports or suspend production, because the existing Trans Mountain Railway and other oil pipelines have excess capacity.