(Reuters) â Oil prices were little changed on Monday as Israel-Hamas peace talks in Cairo tempered fears of a wider conflict in the Middle East, while U.S. inflation data dimmed the prospects of interest rate cuts anytime soon.
Brent crude futures for June , which expire on Tuesday, were down by 51 cents, or 0.6%, to $88.99 a barrel by 0950 GMT. The more active July contract fell 27 cents, or 0.3%, to $87.94 a barrel.
U.S. West Texas Intermediate (WTI) futures were down 22 cents, or 0.3%, at $83.63 a barrel.
A Hamas delegation will visit Cairo on Monday for talks aimed at securing a ceasefire, a Hamas official told Reuters on Sunday.
âWith little other fresh news, the possible cooling of the Gaza environment sees oil prices slip,â said John Evans of oil broker PVM.
Meanwhile, Israeli airstrikes on the southern Gaza city of Rafah on Monday killed at least 20 Palestinians and wounded many others.
Markets were also on watch for the U.S. Federal Reserveâs May 1 monetary policy review.
âThe language and forward forecasts will be pored over by all market participants with magnifying glasses,â PVMâs Evans said.
Ahead of that, on Friday U.S. inflation data put a damper on rate cuts in the near future, rising 2.7% in the 12 months through March, above the Fedâs target of 2%. Lower inflation would have increased the likelihood of interest rate cuts, which tend to stimulate economic growth and oil demand.
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âThe sticky U.S. inflation sparks concerns for âhigher-for-longerâ interest ratesâ, leading to a stronger U.S. dollar and putting pressure on commodity prices, independent market analyst Tina Teng said.
A stronger dollar makes oil more expensive for those holding other currencies.
Further weighing on the outlook for oil demand, Chinaâs industrial profit growth slowed down in March, official data showed on Saturday, in the latest sign of frail domestic demand in the worldâs second largest economy.
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